Order Code RL33998
Financial Services and General Government
(FSGG): FY2008 Appropriations
Updated July 20, 2007
Garrett L. Hatch
Coordinator
Government and Finance Division

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The annual consideration of appropriations bills (regular, continuing, and supplemental) by
Congress is part of a complex set of budget processes that also encompasses the
consideration of budget resolutions, revenue and debt-limit legislation, other spending
measures, and reconciliation bills. In addition, the operation of programs and the spending
of appropriated funds are subject to constraints established in authorizing statutes.
Congressional action on the budget for a fiscal year usually begins following the submission
of the President’s budget at the beginning of each annual session of Congress.
Congressional practices governing the consideration of appropriations and other budgetary
matters are rooted in the Constitution, the standing rules of the House and Senate, and
statutes, such as the Congressional Budget and Impoundment Control Act of 1974.
This report is a guide to a new appropriations bill that Congress is considering for the first
time this year. It is designed to supplement the information provided by the House and
Senate Appropriations Subcommittees on Financial Services and General Government. It
summarizes the status of the bill, its scope, major issues, funding levels, and related
congressional activity. The report lists the key CRS staff relevant to the issues covered and
related CRS products. It is updated as events warrant.
NOTE: A Web version of this document with active links is
available to congressional staff.

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Financial Services and General Government (FSGG):
FY2008 Appropriations
Summary
The FY2008 Financial Services and General Government (FSGG)
appropriations bill (H.R. 2829) includes funding for the Department of the Treasury,
the Executive Office of the President (EOP), the judiciary, the District of Columbia,
and 20 independent agencies. Among the independent agencies funded by the bill
are the General Services Administration (GSA), the Office of Personnel Management
(OPM), the Small Business Administration (SBA), and the United States Postal
Service (USPS).
On June 28, 2007, the House approved $43.8 billion for the FSGG bill, a $3.1
billion increase over FY2007 enacted funding and $101 million above the President’s
FY2008 request. Discretionary spending in the bill totaled $21.4 billion, a decrease
of $245 million from the President’s request, but $1.9 billion more than was enacted
in FY2007. The Senate appropriations FSGG subcommittee marked up its version
of the bill July 10, and the full committee reported it July 12.
Key issues before the 110th Congress when considering the Administration’s
FY2008 budget request include the following:
! The President’s proposals to consolidate the EOP budget accounts,
to expand the authority of the EOP to transfer funds among
appropriations accounts, and to centralize funding for administrative
services;
! Spending on courtroom security enhancements, pay raises for
judges, and the creation of additional judgeships to meet the
demands of rising caseloads;
! Proposed budget cuts for the United States Postal Service (USPS),
which would receive $64 million less than requested and $20 million
below the amount enacted for FY2007; and
! Funding for enforcement, taxpayer services, and business systems
modernization at the Internal Revenue Service.
Note that the detailed description in this report includes action through House
enactment, and that Senate action through the committee report will be in the next
update.

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Key Policy Staff
Area of Expertise
Name
Div.
Telephone
Title I: Department of the Treasury
Treasury, Internal Revenue Service
Gary Guenther
G&F
7-7742
Title II: Executive Office of the President and Funds Appropriated to the President
Executive Office of the President
Barbara Schwemle
G&F
7-8655
Title III: The Judiciary
Judiciary
Lorraine Tong
G&F
7-5846
Judiciary
Steve Rutkus
G&F
7-7162
Title IV: District of Columbia
District of Columbia
Eugene Boyd
G&F
7-8689
Title V: Other Independent Agencies
Generally
Virginia McMurtry
G&F
7-8678
Consumer Product Safety Commission
Bruce Mulock
G&F
7-7775
Election Assistance Commission
Kevin Coleman
G&F
7-7878
E-Government Fund in GSA
Harold Relyea
G&F
7-8679
Federal Communications Commission
Patty Figliola
RSI
7-2508
Federal Deposit Insurance Corporation: OIG
Pauline Smale
G&F
7-7832
Federal Election Commission
R. Sam Garrett
G&F
7-6443
Federal Labor Relations Authority
Gerald Mayer
DSP
7-7815
Federal Trade Commission
Bruce Mulock
G&F
7-7775
General Services Administration
Stephanie Smith
G&F
7-8674
Merit Systems Protection Board
Barbara Schwemle
G&F
7-8655
National Archives and Record Administration
Harold Relyea
G&F
7-8679
National Credit Union Administration
Pauline Smale
G&F
7-7832
Office of Personnel Management
Barbara Schwemle
G&F
7-8655
Office of Special Counsel
Barbara Schwemle
G&F
7-8655
Securities and Exchange Commission
Mark Jickling
G&F
7-7784
Selective Service Commission
David Burrelli
FDT
7-8033
Small Business Administration
Eric Weiss
G&F
7-6209
U.S. Postal Service
Kevin Kosar
G&F
7-3968
General Provisions, Government-Wide
Government-wide General Provisions
Barbara Schwemle
G&F
7-8655
Competitive Sourcing
L. Elaine Halchin
G&F
7-0646
Cuba
Mark Sullivan
FDT
7-7689
DSP = Domestic Social Policy Division
FDT = Foreign Affairs, Defense, and Trade Division
G&F = Government and Finance Division
RSI = Resources, Science, and Industry Division

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Title I: Department of the Treasury . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Department of the Treasury Budget and Key Issues . . . . . . . . . . . . . . . . . . . 5
Treasury Offices and Bureaus (Excluding the IRS) . . . . . . . . . . . . . . . . 6
FY2008 Budget Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
House-Passed Version of H.R. 2829 . . . . . . . . . . . . . . . . . . . . . . . 8
Internal Revenue Service (IRS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Review of Administration’s FY2008 Budget Proposal
by the IRS Oversight Board . . . . . . . . . . . . . . . . . . . . . . . . . 11
House-Passed Version of H.R. 2829 . . . . . . . . . . . . . . . . . . . . . . 12
Title II: Executive Office of the President and Funds Appropriated
to the President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
The Executive Office of the President Budget and Key Issues . . . . . . . . . . 14
Consolidation Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Transfer Authority Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Enterprise Services Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
House-Passed Bill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Title III: The Judiciary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
The Judiciary Budget and Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Cost Containment Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Judicial Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Workload . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Judgeships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Judicial Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
House and Senate Budget Hearings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
FY2008 Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Supreme Court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
U.S. Court of Appeals for the Federal Circuit . . . . . . . . . . . . . . . . . . . 24
U.S. Court of International Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Courts of Appeals, District Courts, and Other Judicial Services . . . . . 24
Salaries and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Court Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Defender Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Fees of Jurors and Commissioners . . . . . . . . . . . . . . . . . . . . . . . 25
Administrative Office of the U.S. Courts (AOUSC) . . . . . . . . . . . . . . 26
Federal Judicial Center . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
United States Sentencing Commission . . . . . . . . . . . . . . . . . . . . . . . . 26
Judiciary Retirement Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
General Provision Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Title IV: District of Columbia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
The District of Columbia Budget and Key Issues . . . . . . . . . . . . . . . . . . . . 29

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President’s Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
District Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
H.R. 2829 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Resident Tuition Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
School Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Title V: Independent Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Consumer Product Safety Commission (CPSC) . . . . . . . . . . . . . . . . . 33
Election Assistance Commission (EAC) . . . . . . . . . . . . . . . . . . . . . . . 33
Federal Communications Commission (FCC) . . . . . . . . . . . . . . . . . . . 33
Federal Deposit Insurance Corporation (FDIC): OIG . . . . . . . . . . . . . 34
Federal Election Commission (FEC) . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Federal Labor Relations Authority (FLRA) . . . . . . . . . . . . . . . . . . . . . 35
Federal Trade Commission (FTC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
General Services Administration (GSA) . . . . . . . . . . . . . . . . . . . . . . . 36
Federal Buildings Fund (FBF) . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Electronic Government Fund (E-Gov Fund) . . . . . . . . . . . . . . . . 38
Independent Agencies Related to Personnel Management . . . . . . . . . 38
Federal Labor Relations Authority (FLRA) . . . . . . . . . . . . . . . . . . . . . 39
Merit Systems Protection Board (MSPB) . . . . . . . . . . . . . . . . . . . . . . 40
Office of Personnel Management (OPM) . . . . . . . . . . . . . . . . . . . . . . 40
Office of Special Counsel (OSC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
National Archives and Records Administration (NARA) . . . . . . . . . . 41
National Credit Union Administration (NCUA) . . . . . . . . . . . . . . . . . 42
Securities and Exchange Commission (SEC) . . . . . . . . . . . . . . . . . . . 42
Selective Service System (SSS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Small Business Administration (SBA) . . . . . . . . . . . . . . . . . . . . . . . . 43
United States Postal Service (USPS) . . . . . . . . . . . . . . . . . . . . . . . . . . 43
United States Tax Courts (USTC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
General Provisions Government-Wide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Competitive Sourcing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Cuba Sanctions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
List of Tables
Table 1. Status of FY2008 Financial Services and
General Government Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Table 2. Financial Services and General Government Appropriations,
by Title, FY2007-FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Table 3. Department of the Treasury Appropriations, FY2007 to FY2008 . . . . . . 4
Table 4. Executive Office of the President and Funds Appropriated to
the President, FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Table 5. The Judiciary Appropriations, FY2007 to FY2008 . . . . . . . . . . . . . . . 19
Table 6. District of Columbia Appropriations, FY2007 to FY2008:
Special Federal Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Table 7. Independent Agencies Appropriations, FY2007 to FY2008 . . . . . . . . . 31
Table 8. General Services Administration Appropriations,
FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Table 9. Independent Agencies Related to Personnel Management
Appropriations,FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

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Financial Services and General Government
(FSGG): FY2008 Appropriations
Most Recent Developments
On June 28, 2007, the House approved $43.8 billion for agencies funded
through the Financial Services and General Government (FSGG) appropriations bill
(H.R. 2829), a $3.1 billion increase over FY2007 enacted funding and $101 million
above the President’s FY2008 request.1 Discretionary spending in the bill totaled
$21.4 billion, a decrease of $245 million from the President’s request, but $1.9
billion more than was enacted in FY2007. The Senate appropriations FSGG
subcommittee marked up its version of the bill July 10, and the full committee
reported it July 12. Table 1 notes the status of the FY2008 FSGG appropriations bill
through the Senate Committee report, but the detailed information in the rest of the
report tracks action only through House enactment. Senate action will be included
in the next update of this report.
Table 1. Status of FY2008 Financial Services and General
Government Appropriations
Conference
Subcommittee
Report
Markup
Approval
House
House
Senate
Senate
Conf.
Public
House
Senate
Report Passage Report Passage Report
House Senate
Law
H.Rept.
S.Rept.
06/05/07 07/10/07 110-207 06/28/07 110-129
06/11/07
07/12/07
Introduction
In early 2007, the House and Senate Committees on Appropriations reorganized
their subcommittee structures. Each chamber created a new Subcommittee on
Financial Services and General Government (FSGG). In the House, the jurisdiction
of the FSGG Subcommittee was formed primarily of agencies that had been under
the jurisdiction of the Subcommittee on Transportation, Treasury, Housing and
1 On June 11, the House Appropriations Committee approved $43.9 billion for the Financial
Services and General Government (FSGG) appropriations bill, but the bill was sent back to
committee before reaching the floor so that earmarks could be added. The amended FSGG
bill, with earmarks, was then approved by the Appropriations Committee June 21.

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CRS-3
Urban Development, the Judiciary, the District of Columbia, and Independent
Agencies, commonly referred to as “TTHUD.”2 In addition, the House FSGG
Subcommittee was assigned four independent agencies that had been under the
jurisdiction of the Science, State, Justice, Commerce, and Related Agencies
Subcommittee.3
In the Senate, the jurisdiction of the new FSGG Subcommittee was a
combination of agencies from the jurisdiction of three previously existing
subcommittees. The District of Columbia, which had its own subcommittee in the
109th Congress, was placed under the purview of the FSGG Subcommittee, as were
four independent agencies that had been under the jurisdiction of the Commerce,
Justice, Science, and Related Agencies Subcommittee.4 Additionally, most of the
agencies that had been under the jurisdiction of the Subcommittee on Transportation,
Treasury, the Judiciary, Housing and Urban Development, and Related Agencies
were assigned to the FSGG Subcommittee.5 As a result of this reorganization, the
House and Senate FSGG subcommittees have nearly identical jurisdictions.6
The FY2008 FSGG appropriations bill (H.R. 2829) provides funding through
five titles, each of which is discussed in a separate section of this report. In addition,
there is a section on General Provisions. The language for government-wide general
provisions was proposed by the Administration in the appendix to the FY2008 budget
request, and was included in Title VII of the House bill.
The House Appropriations Subcommittee on Financial Services and General
Government is the primary source of the House funding figures used throughout the
report. Other sources include the President’s FY2008 budget request and agency
budget materials.
2 The agencies previously under the jurisdiction of the TTHUD Subcommittee that did not
become part of the FSGG subcommittee were the Department of Transportation, the
Department of Housing and Urban Development, the Architectural and Transportation
Barriers Compliance Board, the Federal Maritime Commission, the National Transportation
Safety Board, the Neighborhood Reinvestment Corporation, and the United States
Interagency Council on Homelessness.
3 The agencies are the Federal Communications Commission (FCC), the Federal Trade
Commission (FTC), the Securities and Exchange Commission (SEC), and the Small
Business Administration (SBA).
4 The agencies are the FCC, FTC, SEC, and SBA.
5 The agencies that did not transfer from TTHUD to FSGG were Transportation, HUD, the
Architectural and Transportation Barriers Compliance Board, the Federal Maritime
Commission, the National Transportation Safety Board, the Neighborhood Reinvestment
Corporation, and the United States Interagency Council on Homelessness.
6 The Commodity Futures Trading Corporation (CFTC) is under the jurisidiction of the
FSGG Subcommittee in the Senate but not in the House.

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CRS-4
Overview of FY2008 Appropriations
On June 28, 2007, the House approved $43.8 billion for the FY2008 FSGG
appropriations bill. Compared to FY2007 enacted amounts, the bill would increase
appropriations for each of the five titles, with the largest gains proposed for the
District of Columbia (+10.8%) and the smallest for the Executive Office of the
President (+0.25%). The bill would also increase funding for the Department of the
Treasury (+5.4%), the Judiciary (+4.7%), and Independent Agencies (+9.7%).
Compared to the President’s request, the bill would increase funding for the District
of Columbia (+9.5%), the Department of the Treasury (+1.0%), and Independent
Agencies (+1.0%). Funding under the bill would decrease relative to the President’s
request for the Judiciary (-3.9%) and the Executive Office of the President (-2.1%).
Table 2 lists, by title, the funding levels approved by the House for FY2008, the
amount of the President’s request for FY2008, and the enacted amounts for FY2007.
Table 2. Financial Services and General Government
Appropriations, by Title, FY2007-FY2008
(in millions of dollars)
FY2008
FY2007
FY2008
House
FY2008
FY2008
Title
Enacted
Request
Passed
Senate
Enacted
Title I: Department of the Treasury
$11,625
$12,137
$12,257
Title II: Executive Office of the
720
737
722
President
Title III: The Judiciary
5,980
6,511
6,258
Title IV: District of Columbia
591
598
655
Title V: Independent Agencies
21,797
23,718
23,911
Total
$40,713
$43,701
$43,802
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
Note: Columns may not equal the total due to rounding.
The House provided amounts above the President’s request for particular
accounts, including increases of $301 million for the Election Assistance
Commission, $119 million for the Small Business Administration, and $52 million
for District of Columbia courts. In other cases, the House provided amounts below
the President’s request, including cuts of $254 million from Judiciary accounts.
Key Issues
The wide scope of the FY2008 FSGG appropriations bill — which provides
funding for two of the three branches of the federal government, a city government,
and 20 independent agencies with a range of functions — encompasses a number of
controversial issues. Several key issues, identified below, may be among those
before Congress.

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CRS-5
! Department of the Treasury. Does the proposed budget provides
adequate funding for enforcement, taxpayer services, and business
systems modernization at the Internal Revenue Service?
! Executive Office of the President (EOP). Should Congress accept
the President’s proposals to (1) consolidate EOP budget accounts
into a single appropriation, (2) expand the authority of the EOP to
transfer funds among separate appropriations accounts, and (3)
centralize funding for administrative services provided throughout
the EOP in the Office of Administration?
! The Judiciary. What level of funding should Congress provide for
judicial security enhancements and other workforce issues, such as
pay raises for judges, and the hiring of additional staff and creation
of additional judgeships to meet the demands of rising caseloads?
! Independent Agencies. Should Congress enact the President’s
proposed budget for the United States Postal Service (USPS), which
is $64 million less than what USPS had requested and $20 million
below the amount enacted for FY2007?
Title I: Department of the Treasury
This section examines FY2008 appropriations for the Treasury Department and
its operating bureaus, including the Internal Revenue Service (IRS). Table 3 shows
the FY2007 enacted amount, the President’s FY2008 request, and the FY2008
amount approved by the House.
Table 3. Department of the Treasury Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2007
FY2008
House
FY2008
FY2008
Program or Account
Enacted
Request
Passed
Senate
Enacted
Departmental Offices
$216
$250
$251
Department-wide Systems and Capital
30
19
19
Investments
Office of Inspector General
17
18
18
Treasury Inspector General for Tax
133
141
141
Administration
Air Transportation Stabilization
Programa
—
-4
-4
Community Development Financial
55
29
100
Institutions Fund
Treasury Building and Annex Repair
—
—
—
and Restoration
Financial Crimes Enforcement
73
86
83
Network

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CRS-6
FY2008
FY2007
FY2008
House
FY2008
FY2008
Program or Account
Enacted
Request
Passed
Senate
Enacted
Financial Management Service
235
235
234
Alcohol and Tobacco Tax and Trade
91
94
94
Bureau
Bureau of the Public Debt
178
173
173
Internal Revenue Service, Total
10,597
11,095
11,147
Taxpayer Services
2,138
2,103
2,155
Enforcement
4,686
4,925
4,925
Operations Support
3,545
3,770
3,770
Business Systems Modernization
213
282
282
Health Insurance Tax Credit
15
15
15
Administration
Total: Department of the Treasury
$11,625
$12,137 $12,257
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
Note: Columns may not equal the total due to rounding.
a. The negative appropriation for the Air Transportation Stabilization Program reflects a rescission.
Department of the Treasury Budget and Key Issues
The Treasury Department performs a variety of governmental functions.
Foremost among them are protecting the nation’s financial system against a host of
illicit activities (e.g., money laundering and terrorist financing), collecting tax
revenue, enforcing tax laws, managing and accounting for federal debt, administering
the federal government’s finances, regulating financial institutions, and producing
and distributing coins and currency.
At its most basic level of organization, Treasury consists of departmental offices
and operating bureaus. In general, the offices are responsible for formulating and
implementing policy initiatives and managing Treasury’s operations, while the
bureaus perform specific duties assigned to Treasury, mainly through statutory
mandates. In the past decade or so, the bureaus have accounted for over 95% of the
agency’s funding and work force.
With one possible exception, the bureaus can be divided into those engaged in
financial management and regulation and those engaged in law enforcement. In
recent decades, the Comptroller of the Currency, U.S. Mint, Bureau of Engraving and
Printing, Financial Management Service (FMS), Bureau of the Public Debt,
Community Development Financial Institutions Fund (CDFI), and Office of Thrift
Supervision have undertaken tasks related to the management of the federal
government’s finances or the supervision and regulation of the U.S. financial system.
By contrast, law enforcement has been the central focus of the tasks handled by the
Bureau of Alcohol, Tobacco, and Firearms; U.S. Secret Service; Federal Law
Enforcement Training Center; U.S. Customs Service; Financial Crimes Enforcement

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CRS-7
Network (FinCEN); and the Treasury Forfeiture Fund. Since the advent of the
Department of Homeland Security in 2002, Treasury’s direct involvement in law
enforcement has shrunk considerably. The possible exception to this simplified
dichotomy is the Internal Revenue Service (IRS), whose main duties encompass both
the collection of tax revenue and the enforcement of tax laws and regulations.
Treasury Offices and Bureaus (Excluding the IRS). Funding for many
Treasury bureaus comes largely from annual appropriations. Such is the case for the
IRS, FMS, Bureau of Public Debt, FinCEN, Alcohol and Tobacco Tax and Trade
Bureau, Office of the Inspector General (OIG), Treasury Inspector General for Tax
Administration (TIGTA), and the CDFI. But there are some exceptions to this heavy
reliance on appropriated funds. The Treasury Franchise Fund, U.S. Mint, Bureau of
Engraving and Printing, Office of the Comptroller of the Currency, and the Office of
Thrift Supervision finance their operations largely from the fees they charge for
services and products they provide.
In FY2007, Treasury is receiving $11.625 billion in appropriated funds, or 0.4%
more than it received in FY2006. Most of these funds are being used to finance the
operations of the IRS, which is receiving $10.597 billion in FY2007. The remaining
$1.028 billion is distributed among Treasury’s other bureaus and departmental offices
in the following amounts: departmental offices (which include the Office of
Terrorism and Financial Intelligence, or TFI, and the Office of Foreign Assets
Control) are receiving $216 million; department-wide systems and capital
investments, $30 million; OIG, $17 million; TIGTA, $133 million; CDFI, $55
million; FinCEN, $73 million; FMS, $235 million; Alcohol and Tobacco Tax and
Trade Bureau (ATB), $91 million; and Bureau of the Public Debt, $178 million.
FY2008 Budget Proposal. For FY2008, the Bush Administration is asking
Congress to approve $12.137 billion in funding for Treasury, or 4.4% more than the
amount enacted for FY2007. Once again, most of the requested funding (91%)
would go to the IRS, which would receive $11.095 billion in appropriated funds.
The remaining $1.042 billion would be distributed among Treasury’s other bureaus
and departmental offices in the following amounts: departmental offices would
receive $250 million; departmental systems and capital investments, $19 million;
OIG, $18 million; TIGTA, $141 million; a rescission of about $4 million from the
Air Transportation Stabilization program; CDFI, $29 million; no funding for the
Treasury building and annex repair and restoration; FinCEN, $86 million; FMS,
$235 million; ATB, $94 million; and Bureau of the Public Debt, $173 million.
Except for department-wide systems and capital investments and CDFI, all the major
accounts would be funded at the same level as or at higher levels than the amounts
enacted for FY2007. (The Air Transportation Stabilization program represents
something of an anomaly in this regard, because the Administration is asking
Congress to rescind about $4 million that had already been appropriated.)
Under the Administration’s budget proposal, total full-time equivalent
employment at Treasury is projected to rise from 107,734 in FY2006 to 108,965 in

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CRS-8
FY2008.7 The projected gain of 1,231 employees would be spread unevenly among
the departmental offices, TIGTA, FinCEN, and the IRS.
Treasury budget documents and recent congressional testimony by Secretary
Henry Paulson indicate that the Treasury Department’s proposed budget for FY2008
is intended to support five strategic objectives: (1) promote economic growth,
security, and opportunity; (2) strengthen national security; (3) manage the federal
government’s finances; (4) strengthen financial institutions; and (5) manage
Treasury’s operations effectively.8 In evaluating the Administration’s budget
proposal, one consideration might be the extent to which the proposed budget would
likely support or promote these objectives, and whether other approaches might be
more desirable.
The Administration maintains that the budget proposal would promote the first
objective, in part, by channeling more resources into Treasury’s contribution to
international economic policy coordination and the Committee on Foreign
Investment in the United States, and by eliminating funding for the Bank Enterprise
Awards program, which is administered through the CDFI.9
The Administration claims the proposal would support the second objective
largely by increasing funding for TFI and FinCEN. TFI collects and analyzes
financial intelligence, formulates and implements measures to combat money
laundering, enforces economic sanctions against foreign entities, and conducts
criminal investigations of alleged financial crimes. The Administration is asking
Congress to boost appropriated funds for TFI from $43 million in FY2007 to $56
million in FY2008. Most of the additional money would be used to expand
Treasury’s capacity to “identify potential national security threats and to enforce U.S.
policies to counter those threats,” improve the “information technology and physical
infrastructure of TFI and its component bureaus and offices,” and deepen the
involvement of TFI in the “broader Intelligence Community.”10 FinCEN is
responsible for protecting the U.S. financial system from a wide range of financial
crimes, including money laundering and terrorist financing. Foremost among its
main tasks is administering the Bank Secrecy Act (BSA). The Administration is
asking Congress to increase funding for FinCEN from $73 million in FY2007 to $86
million in FY2008. A portion of the added funds would be used to upgrade an
electronic filing system for BSA forms and FinCEN’s “critical information
technology system,” and to enhance its project management capabilities.11
In the Administration’s view, the budget proposal would support the third
objective by boosting IRS’s budget for enforcement, taxpayer service, and business
7 U.S. Department of the Treasury, FY2008 Budget in Brief (2007), p. 10.
8 See the written testimony of Treasury Secretary Paulson before the House Appropriations
Subcommittee on Financial Services and General Government on March 28, 2007, at
[http://www.ustreas.gov/press/releases].
9 Treasury, FY2008 Budget in Brief, p. 3.
10 Ibid., p. 4.
11 Ibid., pp. 38-39.

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CRS-9
systems modernization, and by implementing several new initiatives intended to
improve taxpayer compliance. (See the next section for more details.)
As the Administration notes in the documents describing its budget proposal for
Treasury, no appropriated funds directly support the fourth objective. This is because
funding for the four Treasury bureaus primarily responsible for ensuring and
sustaining the health and integrity of the U.S. financial institutions — the Office of
the Comptroller, the Office of Thrift Supervision, the U.S. Mint, and the Bureau of
Engraving and Printing — comes mostly from fees they charge for the services and
products they provide.
To support the fifth objective, the Administration is asking Congress to approve
funding for the following projects in the following amounts for FY2008: $6 million
to launch a pilot project known as the Enterprise Content Management system, $2
million to operate and maintain the Treasury Secure Data Network, and $4 million
to improve Treasury’s compliance with the requirements of the Federal Information
Security Management Act and the agency’s “overall security posture.”12
House-Passed Version of H.R. 2829. The House approved $12.257
billion for the operations of the Treasury Department and its operating bureaus in
FY2008. This amount is $120.5 million more than the amount requested by the
Administration and $632 million above FY2007 funding.
Under the measure, three Treasury accounts would receive more in appropriated
funds in FY2008 than the Administration has requested. Specifically, departmental
offices would receive $251 million in FY2008 (or $450,000 more than the amount
requested by the Administration). Of this amount, $56.5 million would go to the
Office of Terrorism and Financial Intelligence ($250,000 above the Administration’s
budget request) and $900,000 to the Office of Financial Education ($200,000 above
the Administration’s budget request). CDFI would receive $100 million (or $71
million more than the amount requested by the Administration). The House
Appropriations Committee has recommended that $13.5 million of $100 million be
used for administrative costs, and that no less than another $14 million be set aside
for the Bank Enterprise Award program.13 The IRS would receive $11.147 billion,
or $52 million more than the amount requested by the Administration.
Two Treasury accounts would be funded at lower levels in FY2008 than the
Administration wanted. Specifically, FinCEN would receive $83 million, or $2.5
million less than the amount requested by the Administration. The recommended
reduction in spending reflected a concern that FinCEN would not be ready anytime
soon to undertake a planned border wire transfer initiative.14 The FMS would receive
$234 million, or $768,000 less than the amount requested by the Administration.
12 Ibid., p. 6.
13 U.S. Congress, House Committee on Appropriations, Financial Services and General
Government Appropriations Bill, 2008, report to accompany H.R. 2829, H.Rept. 110-207,
110th Cong. 1st sess. (Washington: GPO, 2007), p. 23.
14 Ibid., p. 20.

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CRS-10
About $9 million of this amount would be set aside for “information systems
modernization initiatives” and would be available until September 30, 2010.15
Six Treasury accounts would receive the same amount of funding that was
recommended in the Administration’s budget request. They are department-wide
systems and capital investments ($19 million), the Office of the Inspector General
($18 million), TIGTA ($140.5 million), the Air Transportation Stabilization program
(a rescission of $4 million), ATB ($93.5 million), and the Bureau of Public Debt
($173 million).
The version of H.R. 2829 passed by the House would also require the Treasury
Department to prepare an “operating plan” for FY2008 and submit it to the House
Appropriations Committee within 60 days of the bill’s enactment.16 The plan would
have to provide figures on funding and full-time employment for all offices and
operating bureaus in FY2007 and FY2008, and detailed information on any
“initiative, major procurement, and program at the Department.” In addition, the
plan would have to indicate the number of full-time employees at OFAC working on
Cuba sanctions and the number of full-time employees working on sanctions
programs targeted at foreign terrorist organizations.17
Internal Revenue Service (IRS). To help finance its operations and
multitude of spending programs, the federal government levies individual and
corporate income taxes, social insurance taxes, excise taxes, estate and gift taxes,
customs duties, and miscellaneous taxes and fees. The federal agency responsible
for administering and collecting these taxes and fees (except for customs duties) is
the Internal Revenue Service. In discharging this responsibility, the IRS receives and
processes tax returns, related documents, and tax payments; disburses refunds;
enforces compliance through audits and other procedures; collects delinquent taxes;
and provides a host of services to taxpayers with the aim of enabling them to
understand their rights and responsibilities under the federal tax code and resolving
problems without litigation. In FY2006, the agency collected $2.537 trillion before
refunds, the largest component of which was individual income tax revenue of
$1.236 trillion.
The IRS receives funding for its operations from three sources: appropriated
funds, user fees, and so-called reimbursables, which are payments the IRS receives
from other federal agencies and state governments for services it provides. In
FY2006, appropriated funds accounted for 98% of IRS’s operating budget, with user
fees and reimbursables each adding another 1%.
Appropriated funds are distributed among five accounts:
15 Ibid., p. 21.
16 Ibid., p. 14.
17 Ibid., pp. 15-16.

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CRS-11
! (1) taxpayer services, which provides resources for pre-filing
taxpayer assistance, filing and account services, administrative
services for IRS employees, and senior IRS management;
! (2) enforcement, which covers the cost of compliance services,
research and statistical analysis, and administration of the earned
income tax credit;
! (3) operations support, which addresses the improvement and
maintenance of the agency’s information and management systems;
! (4) business systems modernization (or BSM), which provides
funds for developing new information systems for tax administration
and acquiring the hardware and software needed to integrate them
into IRS’s operations; and
! (5) health insurance tax credit administration, which covers the
cost of administering the refundable tax credit for health insurance
established by the Trade Adjustment Assistance Reform Act of
2002.
In FY2007, the IRS is receiving $10.597 billion in appropriated funds, or 0.5%
more than it received in FY2006. Of this amount, $2.138 billion is designated for
taxpayer services, $4.686 billion for enforcement, $3.545 billion for operations
support, $213 million for the BSM program, and $15 million for administration of
the health insurance tax credit. The IRS is one of the many federal agencies being
funded in FY2007 under a year-long continuing resolution (H.J.Res. 20; P.L. 110-5)
enacted in February 2007. Under the resolution, the “requirements, authorities,
conditions, limitations, and other provisions” that governed the use of FY2006
appropriations by all affected agencies are also to govern their use of FY2007
appropriations. As a result, certain restrictions that applied to funding for IRS
operations in FY2006 also apply to the funding for IRS operations in FY2007.
Specifically, the IRS may not reorganize or reduce its workforce in FY2007 without
the consent of the House and Senate Appropriations Committees. In addition, during
FY2007, the IRS is barred from entering the market for tax return preparation
software, and from instituting reductions in taxpayer service until TIGTA completes
a report on the effects of such reductions on taxpayer compliance.
The Bush Administration is asking Congress to appropriate $11.095 billion for
IRS operations in FY2008, or 4.7% more than the amount enacted for FY2007. Of
this amount, $2.103 billion (1.7% less than FY2006) would be used for taxpayer
services, $4.925 billion (5.1% more than FY2007) for enforcement, $3.770 billion
(6.3% more than FY2007) for operations support, $282 million (32.4% more than
FY2007) for the BSM program, and $15 million (the same amount as FY2007) for
administering the health insurance tax credit. Under the budget proposal, total full-
time equivalent employment at the IRS is projected to rise from an estimated 92,404
in FY2007 to 92,814 in FY2008, a gain of 0.4%.18
18 Ibid., p. 10.

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CRS-12
Budget documents indicate the FY2008 budget proposal for the IRS is intended
to support three strategic goals: (1) bolster taxpayer compliance without imposing
additional reporting burdens on taxpayers, (2) continue the agency’s recent efforts to
“increase and improve the delivery of services offered to taxpayers,” and (3) invest
in information technology designed to “give (IRS) employees the tools they need to
administer and improve both taxpayer service and enforcement programs.”19 Guiding
the pursuit of these goals is a commitment to “provide quality service to taxpayers
while enforcing America’s tax laws in a balanced manner.”
As part of its budget proposal for the IRS, the Administration is also asking
Congress to pass a number of legislative proposals.20 Most are intended to improve
taxpayer compliance through actions such as expanded information reporting,
mandatory electronic filing for “certain large businesses,” and expanded penalties for
fraudulent actions by tax preparers and for erroneous refund claims.
In assessing the Administration’s budget proposal for the IRS, lawmakers may
find it useful to consider the extent to which it would support these objectives and
whether or not the proposed budgets for enforcement, taxpayer service, and BSM are
adequate in light of the many challenges facing the agency. Foremost among those
challenges are improving compliance rates among individuals and businesses without
sacrificing recent gains in taxpayer service, generating more reliable estimates of the
rates of non-compliance among business taxpayers, increasing the share of tax returns
filed electronically, upgrading the agency’s computer systems, managing the agency’s
private tax debt collection program in a way that meets the concerns of critics, and
hiring and training sufficient numbers of enforcement agents to replace those who
have retired or quit in recent years.
Review of Administration’s FY2008 Budget Proposal by the IRS
Oversight Board. The IRS Oversight Board came into existence through the IRS
Restructuring and Reform Act of 1998. Its primary responsibilities are to oversee
IRS’s administration of the federal tax code and to ensure that the agency has the
resources and management needed to carry out its mission and achieve its strategic
objectives. Section 7802 of the Internal Revenue Code (IRC) requires the Board to
review and approve the annual budget requests submitted by IRS to the Treasury
Department, and to assess whether the annual budget request for the IRS submitted
to Congress supports the strategic plans of the agency.
The Board released its assessment of the Administration’s FY2008 budget
request for the IRS in April 2007.21 While the Board took a mostly favorable view
of the Administration’s proposal, it favored giving the agency a larger budget than
the Administration requested. The Board commended the Administration for seeking
a 4.7% increase in the IRS’s budget for FY2008 “during a time when discretionary
spending is under great constraints and there is stiff competition among federal
19 Ibid., p. 55.
20 Ibid., p. 64.
21 See IRS Oversight Board, FY2008 IRS Budget Recommendation: Special Report
(Washington: April 2007).

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CRS-13
departments and agencies for resources.”22 It also praised the Administration for
recognizing “the importance of the IRS’ mission to the fiscal well-being of our nation
and (for) proposing these important and much needed investments at this time.” In
the Board’s view, both its budget proposal and the Administration’s are “focused on
improving the ability of the IRS to aggressively pursue its strategic goals in order to
reduce the tax gap.”23 It described the Administration’s budget proposal as “clearly
aligned with the IRS’ most recent strategic plan.”
At the same time, the Board wanted more funds appropriated for enforcement
and infrastructure than the Administration requested. Specifically, the Board called
for spending $105 million more on a variety of enforcement initiatives than the
Administration’s budget request, and $205 million more on projects related to the
BSM and newly installed information systems.24 In the Board’s view, these added
expenditures are critical to the success of current plans to improve taxpayer
compliance and shrink the tax gap.
House-Passed Version of H.R. 2829. H.R. 2829, as passed by the House,
would provide $11.147 billion in appropriated funds for the IRS in FY2008. This
amount is $52 million more than the amount requested by the Administration.
This entire difference lies in recommended funding for taxpayers services. H.R.
2829 would provide $2.155 billion for such services in FY2008, or $52 million more
than the amount requested by the Administration. Of this amount, $8 million would
be set aside for low-income taxpayer clinic grants, up to $4.1 million would be
funneled into the Tax Counseling for the Elderly program, and no less than $179.6
million would be used to fund the operations of the Taxpayer Advocate Service. In
addition, the bill recommends spending $71.5 million for pre-filing services
management (or $6.2 million more than the Administration requested), $127.5
million for taxpayer communications and education (or $12.8 million more than the
Administration requested), $70 million for media and publications (or $5.2 million
more than the Administration requested), and $165.2 million for account
management and assistance (or $18.3 million more than the Administration
requested). In its report on H.R. 2829, the House Appropriations Committee notes
that the recommended increase in spending on taxpayer services is intended to
counter recent reductions in taxpayer services and give the IRS the resources it needs
“to strengthen, improve, and expand taxpayer service.”25
H.R. 2829 would also give the IRS $4.925 billion for enforcement (including
$116.7 million to examine ways to improve taxpayer compliance), $3.770 billion for
operations support, $282 million for the BSM program, and $15 million for the
administration of the health insurance tax credit. The Administration has requested
the same amounts for each account.
22 Ibid., p. 3.
23 Ibid., p. 7.
24 Ibid., p. 14.
25 House Appropriations Committee, report to accompany H.R. 2829, p. 25.

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The version of H.R. 2829 passed by the House lacked a notable provision that
was included in the version of the bill approved by the Appropriation Committee.
That provision would have limited funding in FY2008 for managing IRS’s private
tax debt collection program to $1 million, or $254 million less than the amount
requested by the Administration. Such a limitation would have effectively ended the
program, which has been embroiled in controversy since the IRS gained the authority
to hire private debt collectors in 2004. During the floor debate on the bill in the
House, Representative Jose Serrano, the Chairman of the House Appropriations
Subcommittee on Financial Services, agreed to drop the provision in the face of
opposition from some Republicans. Representative Jim McCreary raised a point of
order against the provision on the grounds that any measure capping funding for the
private tax debt collection program fell under the jurisdiction of the Ways and Means
Committee and thus should not be considered as part of an appropriations bill.26
While conceding the point of order, Representative Serrano disagreed that
eliminating the program would necessarily result in a loss of revenue.
Title II: Executive Office of the President and Funds
Appropriated to the President
All but three offices in the Executive Office of the President (EOP) are funded
in the Financial Services and General Government (FSGG) appropriations bill.27
Table 4 shows the FY2007 enacted appropriations, as requested for FY2008, and as
passed by the House of Representatives for FY2008.
Table 4. Executive Office of the President and Funds
Appropriated to the President,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
House
Senate
FY2008
Office
Enacted
Request
Passed
Passed
Enacted
The White House (total)
$172,993
$187,370
$177,089
Compensation of the
450
450
450
President
The White House Office
53,616
53,156
53,156
(salaries and expenses)
Executive Residence, White
12,398
12,814
12,814
House (operating expenses)
White House Repair and
1,683
1,600
1,600
Restoration
26 Meg Shreve, “Private Debt Collection Survives Appropriation Process,” Tax Notes, July
2, 2007, p. 7.
27 Of the three exceptions, the Council on Environmental Quality and the Office of
Environmental Quality are funded in the House and Senate Interior, Environment, and
Related Agencies Appropriations Act. The Office of Science and Technology Policy and
the Office of the United States Trade Representative are funded in the House and Senate
Commerce, Justice, Science, and Related Agencies Appropriations Act.

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Council of Economic
4,032
4,118
4,118
Advisers
Office of Policy Development
3,487
3,482
3,482
National Security Council
8,684
8,640
8,640
Office of Administration
88,643
103,110
92,829
Office of Management and
76,714
70,866
78,394
Budget
Federal Drug Control Programs
464,447
473,368
460,436
(total)
Office of National Drug
26,766
23,883
26,636
Control Policy
High Intensity Drug
224,730
220,000
226,000
Trafficking Areas Program
Other Federal Drug Control
192,951
224,485
197,800
Programs
Counterdrug Technology
20,000
5,000
10,000
Assessment Center
Unanticipated Needs
990
1,000
1,000
Office of the Vice President
4,432
4,432
4,432
(salaries and expenses)
Official Residence of the Vice
322
320
320
President (operating expenses)
Total: EOP and Funds
$719,898
$737,356
$721,671
Appropriated to the President
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government, President’s FY2008 budget request, and U.S. Executive Office of
the President, Fiscal Year 2008 Congressional Budget Submission (Washington: February 2007).
The Executive Office of the President Budget and Key Issues
The Administration’s FY2008 budget requested an appropriation of more than
$737 million for the EOP and funds appropriated to the President, a 2.4% increase
from the almost $720 million appropriated for FY2007. Within the request, funding
for all “White House” accounts, discussed under “Consolidation Proposal” below,
would increase 8.3%, but funding for the Office of Management and Budget (OMB)
(-7.6%) and the Office of National Drug Control Policy (ONDCP) (-10.8%) would
decrease. The proposed OMB and ONDCP funding reductions primarily result from
the transfer of monies to the Office of Administration account for the enterprise
services initiative (discussed below).
Unlike the FY2006 and FY2007 budget proposals, when the President requested
that the High Intensity Drug Trafficking Areas Program (HIDTAP, under federal
drug control programs) funding be transferred to the Department of Justice, the
FY2008 budget request continued to include the HIDTAP appropriation under the
EOP, but at a level that is 2.1% less than the program’s FY2007 funding. Under
federal drug control as well, significant changes in funding were requested for the
Other Federal Drug Control Programs (+16.3%) and the Counterdrug Technology
Assessment Center (-75%). Overall, though, federal drug control program funding
would increase 2.7%.

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Consolidation Proposal. For the seventh consecutive fiscal year, the
President’s FY2008 budget proposes to consolidate and financially realign several
salaries and expenses accounts that directly support the President into a single annual
appropriation, called “The White House.” The eight accounts included in the
consolidated appropriation would be the following:
! Compensation of the President,
! White House Office (WHO),
! Executive Residence at the White House,
! White House Repair and Restoration,
! Office of Administration,
! Office of Policy Development,
! National Security Council, and
! Council of Economic Advisers.28
This consolidated appropriation would total more than $187 million in FY2008
for the accounts proposed to be consolidated, an increase of 8.3% from the almost
$173 million appropriated in FY2007. Within “The White House Office” account,
funding for the Compensation of the President would remain unchanged; funding for
the Executive Residence at the White House (+3.4%), the Council of Economic
Advisers (+2.1%), and the Office of Administration (+16.3%) would increase; and
funding for White House salaries and expenses (-0.9%), White House repair and
restoration (-4.9%), the Office of Policy Development (-0.1%), and the National
Security Council (-0.5%) would decrease.
The EOP budget submission states that consolidation “presents the best means
for the President to realign or reallocate the resources and staff available in response
to changing and emerging needs and priorities.”29 The conference committees on the
FY2002 through FY2006 appropriations acts decided to continue with separate
appropriations for the EOP accounts to facilitate congressional oversight of their
funding and operation. This practice continues for FY2007 under P.L. 110-5, the
Revised Continuing Appropriations Resolution.30 H.R. 2829, as passed by the
House, continues with separate appropriations for the EOP accounts.
Transfer Authority Proposal. As in the FY2007 budget proposal, the
FY2008 budget requests a general provision in Title VI to continue and expand the
authority for the EOP to transfer 10% of the appropriated funds among several
accounts under the EOP. The proposal is included under the government-wide
general provisions at Section 833 and would cover the following accounts in
FY2008:
28 U.S. Executive Office of the President, Office of Management and Budget, Budget of the
United States Government Fiscal Year 2008, Appendix (Washington: GPO, 2007), pp. 963-
964. (Hereafter referred to as FY2008 Budget, Appendix.)
29 U.S. Executive Office of the President, Fiscal Year 2008 Congressional Budget
Submission (Washington: February 2007), p. EOP-14. (Hereafter cited as EOP Budget
Submission.)
30 P.L. 110-5, February 15, 2007,121 Stat. 8.

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! The White House,31
! Office of Management and Budget,
! Office of National Drug Control Policy,
! Special Assistance to the President and the Official Residence of the
Vice President (transfers would be subject to the approval of the
Vice President),
! Council on Environmental Quality and Office of Environmental
Quality,
! Office of Science and Technology Policy, and
! Office of the United States Trade Representative.32
The OMB Director (or such other officer as the President designates in writing)
would be able to, 15 days after notifying the House and Senate Committees on
Appropriations, transfer up to 10% of any such appropriation to any other such
appropriation. The transferred funds would be merged with, and available for, the
same time and purposes as the appropriation receiving the funds. Such transfers
could not increase an appropriation by more than 50%. According to the EOP budget
submission, the transfer authority would “allow the President to address, in a limited
way, emerging priorities and shifting demands” and would “provide the President
with flexibility and improve the efficiency of the EOP.” The authority “is not
intended to be used for new missions or programs, but to address emerging priorities,
shifting demands, and administrative efficiencies within the currently funded
programs.”33
P.L. 108-447, the Consolidated Appropriations Act for FY2005 (Section 533,
Title V, Division H) authorized transfers of up to 10% of FY2005 appropriated funds
among the accounts for the White House Office, OMB, ONDCP, and the Special
Assistance to the President and Official Residence of the Vice President. For
FY2006, P.L. 109-115, the Transportation, Treasury, Housing and Urban
Development, the Judiciary, the District of Columbia, and Independent Agencies
Appropriations Act, 2006 (Section 725) authorized transfers of up to 10% among the
accounts for the White House and the Special Assistance to the President and Official
Residence of the Vice President. Section 201 of H.R. 2829, as passed by the House,
continues the current practice.
Enterprise Services Proposal. The FY2008 budget request, like that for
FY2007, includes an enterprise services initiative to simplify and make more
efficient the administration of certain common services that are provided throughout
the EOP. Services included in the initiative would be expanded to include burn bag
pickup costs, employee transportation subsidies, and Flexible Spending Account
administrative fees. The budgets for these services in the WHO, Executive
Residence at the White House, Office of Policy Development, National Security
31 The accounts under the White House are Compensation of the President, White House
Office, Executive Residence at the White House, White House Repair and Restoration,
Office of Administration, Office of Policy Development, National Security Council, and
Council of Economic Advisers.
32 FY2008 Budget, Appendix, p. 964.
33 EOP Budget Submission, p. EOP-15.

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Council, Council of Economic Advisers, OMB, ONDCP, Office of Science and
Technology Policy, United States Trade Representative, and the Council on
Environmental Quality would be moved into the Office of Administration (OA). In
order to “be consistent with other EOP components,” the budgets for health unit
services costs, space-related rent costs, and rent-based Federal Protective Service
costs in OMB and ONDCP also would be included in the OA.34
House-Passed Bill.35 H.R. 2829, as passed by the House, provides
appropriations for the accounts under the EOP and funds appropriated to the
President at the levels requested by the President’s budget except for the OA, OMB,
and the various federal drug control accounts. The House Committee on
Appropriations report that accompanies the bill states that the reduction of $10.3
million in the OA appropriation results from keeping the rental payments to GSA for
OMB ($7.5 million) and ONDCP ($2.8 million) under the salaries and expenses
accounts for these entities. The report notes that “all miscellaneous costs in the
Enterprise Services Program” are provided as requested.
The restoration of the $7.5 million to OMB salaries and expenses for the rental
payments to GSA accounts for the increase in the agency’s appropriation. The
committee report expresses continued concern about OMB using the E-Government
initiative “to force its management priorities on agencies that would otherwise
choose different approaches to serving the public and other government agencies that
are better tailored to meet the needs of their customers and meet their statutory
requirements.” It notes the continuation of the government-wide general provision
at Section 737 that prohibits the use of funds for E-Government without prior
consultation and approval by the committee and urges OMB and the agencies “to
work directly with the individual appropriations subcommittees in advance of
recommending e-Government transfers so that approved worthy initiatives can move
forward without disruption.” The report also directs OMB to report to the committee
within 180 days of the act’s enactment on the implementation and effectiveness of
OMB’s guidance to the agencies on reducing fraud and abuse in the federal transit
benefit program.
The restoration of the $2.8 million to ONDCP salaries and expenses for the
rental payments to GSA accounts for the increase in the agency’s appropriation.
Included in the report are directives that ONDCP report to the committee within 90
days of the act’s enactment on the aerial eradication program in Columbia and on the
update of the November 2004 report listing illicit drug prices and purity. Section 202
of H.R. 2829, as passed by the House, requires the President to submit a financial
plan to the House and Senate Committees on Appropriations within 30 days of this
act’s enactment and prior to the initial obligation of ONDCP funds for FY2008. The
plan must be updated every six months and new projects and changes in funding for
ongoing projects would be subject to prior approval by the Appropriations
34 EOP Budget Submission, pp. EOP-16 - EOP-17.
35 On June 26, 2007, OMB issued a Statement of Administration Policy on H.R. 2829 that
urged the House of Representatives to adopt the President’s proposals on consolidation,
transfer authority, and Enterprise Services and his request for full funding for the National
Youth Anti-Drug Media Campaign. (pp. 3-4.)

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CRS-19
Committees. HIDTAP receives an appropriation which is $6 million above the
President’s request. The committee report specifies that the HIDTAs for FY2008
“receive funding at least equal” to their FY2007 “initial allocation level” and that not
less than $2.1 million be used for auditing services and related activities.
The appropriation for the other federal drug control programs account is $26.7
million below the President’s budget request. According to the committee report,
increased funding cannot be justified for the National Youth Anti-Drug Media
Campaign because an ONDCP study and a GAO review found that “there is no clear
evidence that the campaign has resulted in a reduction in drug use among youth.” The
report directs ONDCP to provide recommendations to the committee within 90 days
of the act’s enactment “on the development of improved and meaningful
measurements of the effectiveness of the media campaign, including [those] that
would indicate how the campaign influences youth and parent behavior.” The $197.8
million appropriation for the other federal drug control programs is allocated as
follows:
Drug Free Communities — $90 million
Training and technical assistance for drug court professionals — $1 million
Model Acts — $1 million
Demonstration programs for chronic hard-drug users under community
supervision — $1 million
National Youth Anti-Drug Media Campaign — $93 million
United States Anti-Doping Agency — $9.6 million
World Anti-Doping Agency Dues — $1.7 million
Performance Measures Development — $500,000
The $5 million increase in the appropriation for the CTAC results from the
restoration of funding to the Technology Transfer Program which the President’s
budget had proposed to be terminated.36
The House committee report also addresses two issues under the White House
Office account. First, the report notes that the “account had unobligated balances of
budget authority in excess of $6,500,000, or more than 10 percent of its
appropriation, remaining at the end of fiscal years 2005 and 2006” and states the
expectation that the committee will “be kept fully informed of the reasons for any
significant differences between actual and budgeted spending.” The report expresses
the committee’s concern about the Administration’s extensive editing of the first
report to Congress by the Privacy and Civil Liberties Oversight Board and states “that
the Board must have the authority and independence to thoroughly review, assess,
and report accurately on privacy and civil liberties matters.” The House-passed bill
provides an appropriation of $1.5 million for the Board.37
36 H.Rept. 110-207, pp. 36-40.
37 Ibid., p. 33.

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CRS-20
Title III: The Judiciary
As a co-equal branch of government, the judiciary presents its budget to the
President, who transmits it to Congress unaltered. Table 5 shows appropriations for
the judiciary as enacted for FY2007, as requested for FY2008, and as passed by the
House for FY2008.
Table 5. The Judiciary Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2007
FY2008
House
FY2008
FY2008
Budget Groupings and Accounts
Enacted
Request
Passed
Senate
Enacted
Supreme Court (total)
$74.0
$78.7
$78.7
Salaries and Expenses
62.6
66.5
66.5
Building and Grounds
11.4
12.2
12.2
U.S. Court of Appeals for the Federal
25.3
28.6
28.0
Circuit
U.S. Court of International Trade
15.8
16.7
16.5
Courts of Appeals, District Courts, and
5,696.4
6,202.5
5,954.0
Other Judicial Services (total)
Salaries and Expenses
4,476.6
4,854.5
4,660.6
Court Security
378.7
421.8
396.5
Defender Services
776.3
859.8
830.5
Fees of Jurors and
60.9
62.4
62.4
Commissioners
Vaccine Injury Compensation
4.0
4.1
4.1
Trust Fund
Administrative Office of the U.S.
72.4
78.5
75.7
Courts
Federal Judicial Center
22.9
24.8
24.0
United States Sentencing Commission
14.6
16.2
15.5
Judicial Retirement Funds
58.3
65.4
65.4
Total: The Judiciary
$5,979.7
$6,511.5
$6,257.8
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government. Columns may not equal total due to rounding.
Note: The Administrative Office of the U.S. Courts revised the judiciary’s original FY2008 budget
request estimate on March 21, 2007, from the total of $6.51 billion to $6.43 billion.
The Judiciary Budget and Key Issues
Appropriations for the judiciary — about two-tenths of 1% (0.2%) of the entire
federal budget — are divided into budget groups and accounts. Two accounts that
fund the Supreme Court (the salaries and expenses of the Supreme Court and the

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CRS-21
expenditures for the care of its building and grounds) together make up about 1.2%
of the total judiciary budget. The structural and mechanical care of the Supreme
Court building, and care of its grounds, are the responsibility of the Architect of the
Capitol. The rest of the judiciary’s budget provides funding for the “lower” federal
courts and for related judicial services. The largest account, about 75% of the total
budget — the Salaries and Expenses account for the U.S. Courts of Appeals, District
Courts, and Other Judicial Services — covers the salaries of circuit and district
judges (including judges of the territorial courts of the United States), justices and
judges retired from office or from regular active service, judges of the U.S. Court of
Federal Claims, bankruptcy judges, magistrate judges, and all other officers and
employees of the federal judiciary not specifically provided for by other accounts; it
also covers the necessary expenses of the courts. The judiciary budget does not fund
three “special courts” in the U.S. court system: the U.S. Court of Appeals for the
Armed Forces, the U.S. Tax Court, and the U.S. Court of Appeals for Veterans
Claims. Federal courthouse construction also is not funded within the judiciary’s
budget.
The judiciary was one of the few entities in the federal government that was not
subjected to a hard freeze in the enacted year-long budget continuing resolution for
FY2007 (the Revised Continuing Appropriations Resolution, 2007, P.L. 110-5). The
FY2007 appropriations for the judiciary essentially maintained on-board staffing
levels and addressed the immigration-related caseload. In her March 21, 2007,
testimony before the House and Senate Subcommittees on the judiciary’s FY2008
budget request, Judge Julia S. Gibbons, chair of the Budget Committee of the
Judicial Conference of the United States,38 said that the judiciary recognized the
Administration’s and Congress’s concerns about overall federal spending and budget
deficits. She stated that “every item in our budget request relates to performing the
functions entrusted to us under the Constitution. We have no optional programs;
everything ultimately contributes to maintaining court operations and preserving the
judicial system that is such a critical part of our democracy.”39
Cost Containment Initiatives. According to Judge Gibbons, the Judicial
Conference has endeavored, through cost containment policies, to reduce costs and
increase productivity in the federal judiciary for many years. For example, to limit
the growth of the court rental fees paid to the General Services Administration
(GSA), which currently constitute about 20% of the entire judiciary budget (projected
to exceed one billion dollars in FY2008), the conference approved a cap of 4.9% on
the average rate of growth for courthouse rent to be paid in FY2009 through FY2016.
Through a rent validation project, the judiciary identified GSA rent overcharges
totaling $30 million over three years, and recently found an additional $22.5 million
38 The Judicial Conference of the United States is the principal policymaking body for the
federal courts system. The Chief Justice is the presiding officer of the conference, which
comprises the chief judges of the 13 courts of appeals, a district judge from each of the 12
geographic circuits, and the chief judge of the Court of International Trade.
39 Statement of Honorable Julia S. Gibbons, Chair, Committee on the Budget of the Judicial
Conference of the United States, before the Subcommittee on Financial Services and
General Government of the Committee on Appropriations of the United States Senate,
March 21, 2007, p. 2. Hereafter cited as Judge Gibbons’s March 21, 2007, Statement.

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CRS-22
in overcharges. It is also working with GSA to change the way courthouse rent is
determined and calculated. Restricting the appointment of new magistrate judges and
using information technology (e.g., consolidating computer servers) to increase
efficiency and cost-effectiveness are among other efforts to contain costs.40
Judicial Security. Judicial security — the safe conduct of court proceedings
and the security of judges in courtrooms and off-site — continues to be an issue of
concern. The 2005 Chicago murders of family members of a federal judge; the
Atlanta killings of a state judge, a court reporter, and a sheriff’s deputy at a
courthouse; and the 2006 sniper shooting of a state judge in the judge’s office in
Reno spurred efforts to enhance judicial security. Early in the 110th Congress, the
chairmen of House and Senate judiciary committees introduced companion bills
(H.R. 660 and S. 378, respectively), the Court Security Improvement Act of 2007,
to strengthen security.41 Legislation in the 109th Congress (P.L. 109-13) appropriated
$11.9 million to the U.S. Marshals Service (USMS) to provide intrusion detection
systems in the homes of federal judges who requested them. To date, 90% of the
systems have been installed.42 According to the judiciary, it has been experiencing
problems with perimeter security functions that the Federal Protective Service (FPS)
provides the judiciary at court facilities, and billing issues with FPS. On March 13,
2007, the Judicial Conference endorsed a recommendation to support efforts to
transfer to USMS the security functions that FPS currently provides to court
facilities, as well as the associated funding for these functions.43
In report language, the House Appropriations Committee expressed its concern
with “the quality of service” FPS has provided the judiciary, and encouraged the
judiciary to “explore options with other federal law enforcement agencies that might
be able to provide these security services.”44
Workload. According to Judge Gibbons, the President’s FY2008 budget
request for $13 billion to bolster border security and immigration enforcement will
result in a dramatic increase in the judiciary’s caseload. Immigration-related cases
now make up 25% of the district courts’ criminal caseload. Noting the President’s
funding for 3,000 additional border patrol agents (by the end of 2008, the goal of
achieving the level of 18,000-plus agents will double the number of agents in place
in 2001), Judge Gibbons stated that the judiciary “cannot absorb the additional
workload generated by the homeland security initiatives within current resource
levels.” The workload in the judiciary’s probation and pretrial services programs
also continues to grow — in 2006 there were 112,697 people under supervision, with
40 Ibid., pp. 3-4.
41 For more details about legislative proposals to enhance judicial security, see CRS Report
RL33464, Judicial Security: Responsibilities and Current Issues, by Lorraine H. Tong.
42 U.S. Marshals Service, Office of Congressional Affairs, provided the information to the
author in February 2007.
43 Judge Gibbons’s March 21, 2007, Statement.
44 U.S. Congress, House Committee on Appropriations, Financial Services and General
Government Appropriations Bill, 2008, report to accompany H.R. 2829, 110th Cong., 1st
sess., H.Rpt.110-207 (Washington: GPO, 2007), p. 45.

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CRS-23
a projected increase to 114,600 in 2007. Bankruptcy filings, however, have declined
sharply from 2006.45
Judgeships. The Judicial Conference voted on March 13, 2007, to ask
Congress to create 67 new federal judgeships — 15 for the courts of appeals (13
permanent, 2 temporary) and 52 for the district courts (38 permanent, 14 temporary)
— to make permanent five temporary judgeships, and to extend another temporary
judgeship for five years. According to the judiciary, since the 1990 omnibus
judgeship bill, the number of courts of appeals judges has remained the same, while
federal appellate court case filings increased by 55% over the same 17-year period.
According to the judiciary, the number of district court judgeships increased by 4%,
while case filings increased by 29%, over the same period of time.46
Judicial Pay. Another key issue being discussed is the judiciary’s advocacy
for a significant increase in judicial pay. John G. Roberts, Jr., Chief Justice of the
United States, stated in his 2006 End-of-the-Year Report on the Federal Judiciary
that judges’ pay has not kept pace with inflation over the years and has led to judges
leaving the bench in increasing numbers. According to the Chief Justice, retaining
and attracting the best talent to the courts is a serious concern. He stated that failure
to raise judicial salaries has reached the level of a “constitutional crisis that threatens
to undermine the strength and independence of the federal Judiciary.”47
House and Senate Budget Hearings
On March 8, 2007, the House Appropriations Subcommittee on Financial
Services and General Government held a hearing on the Supreme Court budget
request for FY2007, and heard testimony from Supreme Court Justices Anthony M.
Kennedy and Clarence Thomas. Issues raised at the hearing included the Supreme
Court building modernization project, workload, technology improvements, judicial
security, minority clerk hiring, and televising Supreme Court proceedings. The
subcommittee held another hearing on March 21, 2007, to hear testimony on the
federal judiciary budget request from Judge Julia S. Gibbons, United States Circuit
Judge for the Sixth Circuit Court of Appeals and chair of the Budget Committee of
the Judicial Conference of the United States, and James C. Duff, director of the
Administrative Office of the U.S. Courts (AOUSC). Among issues raised at the
hearing were judicial security, rent paid to GSA, and workload. The Senate
Appropriations Subcommittee on Financial Services and General Government also
held a hearing on the FY2008 budget request on March 21, 2007. Judge Gibbons and
Director Duff gave testimony at the hearing on the same issues that were discussed
at the House hearing.
45 Ibid., pp. 4-5.
46 U.S. Courts, News Release, “Federal Judiciary Says New Judgeships Needed,” March
13, 2007, at [http://www.uscourts.gov/Press_Releases/judconf031307.html].
47 U.S. Supreme Court, Chief Justice’s “2006 Year-End Report on the Federal Judiciary,”
(Washington, DC: 2007), at [http://www.supremecourtus.gov/publicinfo/year-end/
2006year-endreport.pdf].

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CRS-24
Judge Gibbons asked the House and Senate subcommittees to fund fully the
judiciary’s budget request. She stated that, “A funding shortfall for the federal courts
could result in a significant loss of existing staff, cutbacks in the level of services
provided and a diminution in the administration of justice.”

FY2008 Request.48 For FY2008, the judiciary requests $6.51 billion in total
appropriations, an 8.9% increase over the $5.98 billion enacted for FY2007.49
According to the judiciary, about 82% of the increase would provide for pay
adjustments, inflation, and other adjustments necessary to maintain current services.
The FY2008 request includes funding for 33,675 full-time-equivalent (FTE)50
positions — an increase of 2.1% over the estimated 32,972 FTEs for FY2007.
The House-passed bill would provide $6.26 billion for the judiciary — a $278.1
million increase over the FY2007 enacted amount, but $253.7 million below the
FY2008 request.51
The following are highlights of the FY2008 judiciary budget request, selected
House committee report language, and the House-passed amounts for each account:
Supreme Court. For FY2008, the total request for the Supreme Court
(salaries and expenses plus buildings and grounds) was $78.7 million, a 6.4 %
increase over the FY2007 appropriation of $74.0 million. The total request
comprises two accounts: (1) Salaries and Expenses — $66.5 million was requested,
an increase of $3.9 million (6.3%) over the $62.6 million enacted for FY2007; and
(2) Care of the Building and Grounds — $12.2 million was requested, an increase of
$0.8 million (6.8%) over the $11.4 million enacted for FY2007. Most of the
requested increase in salaries and expenses would fund increases in salary and benefit
costs, and inflationary fixed costs. An additional six FTEs were requested. The
House approved the full amount requested for this account.
Language in the House committee report directed the Supreme Court to include
in its budget justification materials, an annual report providing information on
technology carry-over balances as well as descriptions of each expenditure made in
the previous fiscal year and the planned expenditures in the budget year. The
committee also stated its expectation to be informed of any changes to the scope and
48 Administrative Office of the U.S. Courts, The Judiciary Fiscal Year 2008 Congressional
Budget Summary (Washington: February 2007). Hereafter cited as Judiciary FY2008
Congressional Budget Summary.
49 The judiciary revised its request on March 21, 2007, reducing the original budget request
from $6.51 billion to $6.43 billion, or an $80 million reduction. (The original FY2008
request had been estimated and submitted prior to the enactment of legislation, P.L. 110-5,
to appropriate funds for the judiciary for FY2007.) The judiciary expects to submit a
complete revised budget to the subcommittee in May 2007.
50 AOUSC provided a revised FY2008 request for 33,225 FTEs to the author on March 17,
2007.
51 The House-passed bill would provide $173.5 million below the revised budget request of
$6.43 billion that AOUSC submitted on March 21, 2007.

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CRS-25
projected completion date of the court’s building modernization project. Funds in
the Care of Buildings and Grounds account are to remain available until expended.
U.S. Court of Appeals for the Federal Circuit. This court, consisting of
12 judges, has nationwide jurisdiction and reviews, among other things, lower court
rulings in patent, trademark, and copyright cases. The FY2008 request for this
account was $28.5 million — a $3.2 million (12.7%) increase over the $25.3 million
appropriated for FY2007. The House approved $28.0 million, a $2.7 million
increase over the FY2007 enacted amount, but $0.6 million below the request for this
account.
U.S. Court of International Trade. This court has exclusive jurisdiction
nationwide over the civil actions against the United States, its agencies and officers,
and certain civil actions brought by the United States (import transactions and
enforcement of federal customs and international trade laws). The FY2008 request
was $16.7 million — a $0.9 million (5.7%) increase over the FY2007 appropriation
of $15.8 million that the judiciary budget submission ascribes largely to increases in
pay and benefits. The House approved $16.5 million, a $0.7 million increase over
the FY2007 enacted amount, but about $0.2 million below the request.
Courts of Appeals, District Courts, and Other Judicial Services. his
budget group includes 12 of the 13 courts of appeals and 94 district judicial courts
located in the 50 states, the District of Columbia, the Commonwealth of Puerto Rico,
the territories of Guam and the U.S. Virgin Islands, and the Commonwealth of the
Northern Mariana Islands. Totaling about 95% of the judiciary budget, the four
accounts in the group — salaries and expenses, court security, defender services, and
fees of jurors and commissioners — fund most of the day-to-day activities and
operations of the federal circuit and district courts. For this budget group, the
FY2008 request was $6,202.5 million, a $506.1 million increase over the FY2007
enacted amount of $5,696.4 million. The House approved $5,954.1 million, an
increase of $257.6 million over the FY2007 enacted amount, but $248.5 million
below the request.52
The total of this budget group53 comprises the following accounts:
Salaries and Expenses. The FY2008 request for this account was $4,854.5
million, a $377.9 million increase over the FY2007 level of $4,476.6 million.
According to the budget request, this increase was needed for inflationary and other
adjustments to maintain the courts’ current services. The House approved $4,660.6
52 On June 27, 2007, during House floor consideration of the bill, an amendment (H.Amdt.
455) was introduced — but withdrawn by unanimous consent — to increase funding for the
Court of Appeals, District Courts, and Other Judicial Services account by $10 million. The
amendment also would have decreased by the same amount of funding for the District of
Columbia courts (which is funded under this bill, but not under Title III, the judiciary
account). The intent of the amendment was to increase funding to alleviate the strain of the
workload and backlog of cases for the district courts along the U.S.-Mexican border.
53 The total includes about $4 million for the Vaccine Injury Compensation Trust Fund.

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CRS-26
million, a $184.0 million increase over the FY2007 enacted amount, but $193.9
million below the request.
Court Security. This account provides for protective guard services, security
systems, and equipment for courthouses and other federal facilities to ensure the
safety of judicial officers, employees, and visitors. Under this account, a major
portion of the funding is transferred to the U.S. Marshals Service for administering
the Judicial Facility Security Program to pay for court security officers. The FY2008
request was $421.8 million — a $43.1 million (11.4%) increase over the FY2007
appropriation of $378.7 million. This increase was reportedly driven by pay and
benefit adjustments and other adjustments needed to maintain current services.
Payment to the Federal Protective Service (FPS) is also covered under this account;
$74.6 million requested would be an increase of $6.7 million (10%) over the FY2007
appropriation of $67.9 million. The House approved $396.5 million, a $17.8 million
increase over the FY2007 enacted amount, but $25.3 million below the request. Up
to $15 million for this account is to remain available until expended.
The House committee recommendation, as approved by the House, provided for
inflationary increases, 52 additional court security officers, as well as court security
officers and screening equipment at probation and pretrial service offices in leased
facilities. In report language, the House committee expressed concern with “the
quality of service” the FPS has provided the judiciary, and encouraged the judiciary
to “continue to explore options with other Federal law enforcement agencies that
might be able to provide these security services.”54
Defender Services. This account funds the operations of the federal public
defender and community defender organizations, and the compensation,
reimbursement, and expenses of private practice panel attorneys appointed by the
courts to serve as defense counsel to indigent individuals accused of federal crimes.
The FY2008 request was $859.8 million — an $83.5 million (10.8 %) increase over
the FY2007 appropriation of $776.3 million. The House approved $830.5 million,
a $54.2 million increase over the FY2007 enacted amount, or $29.3 million below
the request.
Fees of Jurors and Commissioners. This account funds the fees and
allowances provided to grand and petit jurors, and the compensation of jury and land
commissioners. The FY2008 request was $62.4 million — a $1.5 million (2.3%)
increase over the FY2007 appropriation of $60.9 million. The increase in the request
was due mainly to inflationary costs associated with expenses paid to jurors. The
House approved the full amount requested.
Administrative Office of the U.S. Courts (AOUSC). As the central
support entity for the judiciary, the AOUSC provides a wide range of administrative,
management, program, and information technology services to the U.S. courts. The
AOUSC also provides support to the Judicial Conference of the United States, and
54 U.S. Congress, House Committee on Appropriations, Financial Services and General
Government Appropriations Bill, 2008, report to accompany H.R. 2829, 110th Cong., 1st
sess., H.Rpt.110-207 (Washington: GPO, 2007), p. 45.

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CRS-27
implements conference policies and applicable federal statutes and regulations. The
FY2008 request for this account was $78.5 million — a $6.1 million (8.5%) increase
over the FY2007 level of $72.4 million. The increase was reportedly for pay
increases and other inflationary adjustments and for the anticipated reduction in non-
appropriated funds. The AOUSC also receives non-appropriated funds from fee
collections and carryover balances to supplement its appropriations requirements.
The House approved $75.7 million, a $3.3 million increase over the FY2007 enacted
amount, but $2.9 million below the request.
Federal Judicial Center. As the judiciary’s research and education entity,
the center undertakes research and evaluation of judicial operations for the Judicial
Conference committees and the courts. In addition, the center provides judges, court
staff, and others with orientation and continuing education and training. The center’s
FY2008 request was $24.8 million — a $1.9 million (8.6 %) increase over the
FY2007 appropriation of $22.9 million. The House approved $24.0 million, a $1.1
million increase over the FY2007 enacted amount, but $0.8 million below the
request.
United States Sentencing Commission. The commission promulgates
sentencing policies, practices, and guidelines for the federal criminal justice system.
The FY2008 request was $16.2 million — a $1.6 million (10.9%) increase over the
FY2007 appropriation of $14.6 million. The House approved $15.5 million, a $0.9
million increase over the FY2007 enacted amount, but $0.7 million below the request
Judiciary Retirement Funds. This mandatory account provides for three
trust funds that finance payments to retired bankruptcy and magistrate judges, retired
Court of Federal Claims judges, and spouses and dependent children of deceased
judicial officers. The FY2008 request was $65.4 million — a $7.1 million (12.2%)
increase over the FY2007 appropriation of $58.3 million. The House approved the
full amount requested.
General Provision Changes. According to the budget request submission,
the judiciary proposed the following new language under general provisions:
Section 406: which gives the judiciary the same delegated authority as the
executive branch to contract for space alteration projects not exceeding $100,000
(without having to go through GSA involvement).
The judiciary proposed to delete the following provisions:
Section 402: which requires the judiciary to notify Congress of appropriations
transfers and reprogramming requests (change would remove the judiciary’s
reporting requirement).
Section 404: which requires the judiciary to provide a separate, detailed financial
plan for the Judiciary Information Technology fund (change would remove the
judiciary’s reporting requirement).55
55 Judiciary FY2008 Congressional Budget Summary, p. 7.

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CRS-28
The House-passed bill approved the extension of a judgeship in Northern Ohio
in Section 305. It also approved the following provisions (as in previous years):
Sec. 301: which permits funding for salaries and expenses for the employment
of experts and consultant services as stipulated in law (5 U.S.C. 3109).
Sec. 302: which permits up to five percent of any appropriation made for
FY2008 to be transferred between judiciary appropriation accounts provided that
no appropriation shall be decreased by more than five percent or increased by
more than 10 percent by any such transfer except in certain circumstances. It
also provides that such transfers shall be treated as reprogramming of funds and
shall not be available for obligation or expenditure except in compliance with
procedures set forth in sections 605 and 610.
Sec. 303: which authorizes not to exceed $11,000 for official reception and
representation expenses incurred by the Judicial Conference of the United States.
Sec. 304: which requires a financial plan for the judiciary within 90 days of
enactment of the act.
The judiciary also uses non-appropriated funds to offset its appropriations
requirement. The majority of these non-appropriated funds are from fee collections,
primarily from court filing fees. The fees are used to offset expenses within the
Salaries and Expenses account. In some instances, the judiciary also has funds which
may carry forward from one year to the next. These funds are considered
“unencumbered” because they result from savings from the judiciary’s financial plan
in areas where budgeted costs did not materialize. According to the judiciary, such
savings are usually not under its control (e.g., the judiciary has no control over the
confirmation rate of Article III judges and must make its best estimate on the needed
funds to budget for judgeships, rent costs based on delivery dates, and technology
funding for certain programs).
The judiciary has stated that it will keep Congress apprised throughout the
appropriations cycle on changes in the anticipated non-appropriated funds and adjust
its budget request accordingly. The judiciary also has “encumbered” funds — no-
year authority funds for specific purposes, used when planned expenses are delayed,
from one year to the next (e.g., costs associated with space delivery, and certain
technology needs and projects).56
Title IV: District of Columbia
The authority for congressional review and approval of the District’s budget is
derived from the Constitution and the District of Columbia Self-Government and
Government Reorganization Act of 1973 (Home Rule Act).57 The Constitution gives
Congress the power to “exercise exclusive Legislation in all Cases whatsoever”
56 Ibid., pp. 33-34.
57 See Article I, Sec. 8, clause 17 of the U.S. Constitution and Section 446 of P.L. 93-198,
87 Stat. 801.

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CRS-29
pertaining to the District of Columbia. In 1973, Congress granted the city limited
home rule powers and empowered citizens of the District to elect a mayor and city
council, but Congress retained the power to review and approve all District laws,
including the District’s annual budget. As required by the Home Rule Act, the city
council must approve a budget within 50 days after receiving a budget proposal from
the mayor. The approved budget must then be transmitted to the President, who
forwards it to Congress for its review, modification, and approval.58 Both the
President and Congress may propose financial assistance to the District in the form
of special federal payments in support of specific activities or priorities. Table 6
shows the FY2007 enacted amount, the President’s FY2008 request, and the amount
approved by the House of Representatives, for the District.
Table 6. District of Columbia Appropriations, FY2007 to FY2008:
Special Federal Payments
(in millions of dollars)
FY2008
FY2007
FY2008
FY2008
FY2008
House
Enacted
Request
Senate
Enacted
Passed
Resident Tuition Support
32.9
35.1
35.1
Emergency Planning and Security
8.5
3.0
3.4
District of Columbia Courts
216.7
213.9
256.4
Defender Services
43.5
43.5
52.5
Court Services and Offender
Supervision Agency
179.6
190.3
190.3
Public Defender Service
31.1
32.7
32.7
Criminal Justice Coordinating
Council
1.3
1.3
1.3
Water and Sewer Authority
6.9
12.0
12.0
Anacostia Waterfront Initiative
3.0
—
—
Transportation Assistance
1.0
—
—
Foster Care Improvements
2.0
—
—
CFO administered grants
20.0
—
6.1
Education Improvements
39.6
40.8
40.8
— Public Schools
[12.8]
[13.0]
[13.0]
— Public Charter Schools
[12.8]
[13.0]
[13.0]
— Education Vouchers
[14.0]
[14.8]
[14.8]
Consolidated Laboratory facilities
5.0
10.0
10.0
58 87 Stat. 801.

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FY2008
FY2007
FY2008
FY2008
FY2008
House
Enacted
Request
Senate
Enacted
Passed
Public Libraries
—
10.0
10.0
FBI Reimbursement
—
5.0
4.0
Special Federal Payments
$591.0
$597.6
$654.6
(total)
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
The District of Columbia Budget and Key Issues
President’s Request. The Administration’s proposed FY2008 budget
includes $597.6 million in special federal payments to the District of Columbia.
Funding for the courts and criminal justice system (court operations, defender
services, offender supervision, and criminal justice coordinating council) represents
$481.7 million, or 80.6%, of the request. The President’s budget also includes $75.9
million in special federal payments for specific education initiatives, including $35.1
million for college tuition assistance, $13 million for public school enhancements,
$13 million for public charter schools, and $14.8 million for the school choice
(school voucher) program, which provides grants to eligible students to attend private
schools.
In addition to recommending $597.6 million in special federal payments to the
District of Columbia, the President’s budget also contains a number of general
provisions, including a number of so-called “social riders.” Consistent with
provisions included in previous appropriations acts, the budget includes provisions
that would prohibit the use of federal and District funds to finance or administer a
needle exchange program intended to reduce the spread of AIDS and HIV among
intravenous drug abusers and their partners, or provide abortion services except in
instances of rape or incest, or when the health of the mother is threatened. It also
includes provisions that prohibit the city from decriminalizing the use of marijuana
for medical purposes, and limit the city’s ability to use District funds to lobby for
congressional voting representation or statehood.
District Budget. On March 23, 2007, the mayor submitted a proposed budget
to the District’s city council for consideration and approval. The proposed budget
included $597.6 million in special federal payments, which is consistent with the
amount included in the President’s proposed budget for FY2008.
The District Delegate to Congress has introduced legislation, H.R. 733, that
would eliminate congressional review of the District’s budget, granting the city
budget autonomy over locally raised revenues. For several years, District officials
have complained that delays in congressional review and approval of the city’s
budget have hampered the city’s ability to efficiently plan and manage its resources.

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CRS-31
H.R. 2829. The House-passed FSGG bill includes $654.6 million in special
federal payments for the District of Columbia. This is $63.6 million more than
appropriated in FY2007 and $57 million more than requested by the Administration
or the District for FY2008. Specifically, the House version of H.R. 2829,
recommends substantially increased funding for District of Columbia Court
operations, defender services, and offender supervision than appropriated for
FY2007 or requested by the Administration (See Table 6). In addition, the bill
includes new funds for enhancements to the public library system
The House bill would eliminate funding for the Anacostia Waterfront Initiative,
transportation assistance, and foster care, which were funded in FY2007.
Additionally, it would cut funding for emergency planning and security activities
from $8.5 million to $3 million and reduce funding for earmarked grants
administered by the CFO from $20 million to $6.1 million. The bill would continue
to support education initiatives in the District including $35 million for resident
tuition support and $40.8 million in support of public schools, public charter schools,
and private school vouchers. These education initiatives are further discussed below.
Resident Tuition Support . The District of Columbia Tuition Access Grant
(DCTAG) program provides tuition support through grants to institutions of higher
education (IHEs) for eligible residents of the District of Columbia by paying the
difference between in-state and out-of-state tuition (up to $10,000) at public IHEs;
and up to $2,500 per year for tuition at private non-profit IHEs that are either located
in the Washington, DC, metropolitan area, or are Historically Black Colleges and
Universities (HBCUs). Funding has been provided for the program annually
beginning with FY2000. The DCTAG program is authorized through FY2007; and
legislation (H.R. 1124 and S. 343) is being considered to extend it through FY2012.
Under H.R. 2829, $35.1 million would be appropriated for the DCTAG program, of
which $1.2 million would be available for administrative expenses. H.R. 2829 also
provides that awards made under the DCTAG program may be prioritized on the
basis of a resident’s academic merit, the need of eligible students, and other factors
as may be authorized.
School Improvement. Under H.R. 2829, $40.8 million would be
appropriated for school improvement programs in the District of Columbia. From
these funds, $13.0 million would be provided to the District of Columbia Public
Schools to support the improvement of public education; $13.0 million would be
provided the State Education Office to expand quality public charter schools; and
$14.8 million would be provided to the Secretary of the U.S. Department of
Education for the operation of the D.C. Opportunity Scholarship program, of which
$1.8 million would be available to administer and fund assessments. The D.C.
Opportunity Scholarship program enables children from families with incomes not
exceeding 185% of the poverty line to apply to receive scholarships valued at up to
$7,500 to cover the costs of tuition, fees, and transportation expenses associated with
attending participating private elementary and secondary schools located in the
District of Columbia. Scholarship recipients remain eligible to continue to
participate in the program in subsequent years, so long as their family income does
not exceed 300% of the poverty level. The D.C. Opportunity Scholarship program
has been funded annually beginning with FY2004, and is authorized through
FY2008.

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CRS-32
The bill includes language that would modify several general provisions
included in previous appropriations acts. This includes allowing the use of District
funds for a needle exchange program aimed at reducing the spread of AIDS caused
by the use of tainted needles by users of illegal drugs. This is a departure from
previous appropriations acts which prohibited the use of District and federal funds
in support of a needle exchange program. Representative Souder unsuccessfully
offered two amendments (H.Amdt. 465 and H.Amdt. 466) that would have
prohibited the use of federal and District funds for a needle exchange program. The
bill would leave unchanged current prohibitions on the use of federal and District
funds for abortion services, except in instances where the life or health of the mother
was in jeopardy, and on the use of federal and District funds to regulate or
decriminalize the use of marijuana for medical purposes.
Title V: Independent Agencies
In addition to funding for the Department of the Treasury, the Executive Office
of the President, the Judiciary, and the District of Columbia, a collection of 20
independent entities are slated to receive funding through this appropriations bill in
FY2008. Table 7 lists appropriations as enacted for FY2007, as requested by the
President for FY2008, and as passed by the House of Representatives, for each of the
agencies.
Table 7. Independent Agencies Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
House
Senate
FY2008
Agency
Enacted
Request
Passed
Passed
Enacted
Consumer Product Safety
$63
$63
$67
Commission
Election Assistance Commission
16
15
316
Federal Communications
Commission a
1
1
1
Federal Deposit Insurance
Corporation: Office of Inspector
(31)
(27)
(27)
General (by transfer) b
Federal Election Commission
55
59
59
Federal Labor Relations Authority
25
24
24
Federal Trade Commission a
59
82
88
General Services Administration c
-38
442
179
Merit Systems Protection Board
39
40
40
Morris K. Udall Foundation
4
1
4
National Archives and Records
331
369
388
Administration
National Credit Union
1
1
1
Administration
Office of Government Ethics
11
12
12
Office of Personnel Management
19,594
21,098
21,110
(total)

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CRS-33
FY2008
FY2008
FY2007
FY2008
House
Senate
FY2008
Agency
Enacted
Request
Passed
Passed
Enacted
Salaries and Expenses
112
102
102
Government Payments for
Annuitants, Employees Health
8,780
8,884
8,884
Benefits
Government Payments for
Annuitants, Employee Life
39
41
41
Insurance
Payment to Civil Service
10,532
11,941
11,941
Retirement and Disability Fund
Office of Special Counsel
16
16
16
Securities and Exchange
Commission d
868
875
867
Selective Service System
25
22
22
Small Business Administration
572
464
582
United States Postal Service
109
89
89
United States Tax Court
48
45
45
Total: Independent Agencies
$21,797
$23,718
$23,911

Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
Note: Columns may not equal the total due to rounding.
a. The amounts listed in Table 7 for the FCC and the FTC only represent direct appropriations and
do not include fees collected by the agencies that are also used to fund agency activities.
b Budget authority transferred to FDIC is not included in total appropriations for Title V; it is counted
as part of the budget authority in the appropriation account from which it came.
c. Budget authority for GSA is calculated as the net value of appropriations, including limitations on
the availability of revenues, plus the redemption of debt payments, minus anticipated revenues
from rents paid into Federal Buildings Fund. In FY2007, anticipated revenues exceeded the sum
of appropriations plus redemption of debt payments, resulting in negative net obligational
authority.
d. The amounts listed in Table 7 for the SEC include fees collected by the agency. This is not
consistent with the treatment of fees for the FCC and the FTC, but it follows the source
document for Table 7.

Consumer Product Safety Commission (CPSC). The CPSC is an
independent federal regulatory agency whose enabling legislation is the Consumer
Product Safety Act of 1972. The Commission’s primary responsibilities include
protecting the public against unreasonable risks of injury associated with consumer
products; developing uniform safety standards for consumer products and minimizing
conflicting state and local regulations; and promoting research and investigation into
the causes and prevention of product-related deaths, illnesses, and injuries.
For FY2008, the President’s budget called for providing CPSC with $63.3
million, just slightly more than the agency’s current funding level of $62.7 million.

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CRS-34
The House provided $66.8 million for CPSC, $3.5 million above the
Administration’s request.
Consumer groups and others continue to express concerns over the CPSC’s
staffing level, especially in light of recent news stories about unsafe exports (notably
including toys) from China. In 1977, three years after the Commission opened its
doors, it had a staff of 900. The staffing level has declined substantially over the past
three decades. The budget for FY2007 culminated a two-year reduction of full-time
positions (FTEs) from 471 to 420. The Commission’s request for FY2008 would
require a decrease of an additional 19 FTEs.
Election Assistance Commission (EAC). The EAC provides grant
funding to the states to meet the requirements of the Help America Vote Act
(HAVA), provides for testing and certification of voting machines, studies election
issues, and promulgates voluntary guidelines for voting systems standards and issues
voluntary guidance with respect to the requirements in the act. The commission was
not given rule-making authority under HAVA, although the law transferred
responsibilities for the National Voter Registration Act from the Federal Election
Commission to the EAC, which included NVRA rule-making authority. The
Department of Justice is charged with enforcement responsibility.
As passed by the House, H.R. 2829 provides $316 million for the EAC. This
amount includes $300 million for election reform requirements payments, $15.5
million for salaries and expenses — with $3.25 million of that amount for the
National Institute of Standards and Technology (NIST) — and $950,000 for both the
Help America Vote College Program and the National Student and Parent Mock
Election Program. The President requested $15.46 million for FY2008, including
$3.25 million for the NIST. For FY2007, Congress appropriated $16.24 million for
the EAC, of which $4.95 million was for the National Institute of Standards and
Technology, $4.83 million for protection and advocacy programs, and $10.89 million
for disability access.
Federal Communications Commission (FCC). The Federal
Communications Commission, created in 1934, is an independent agency charged
with regulating interstate and international communications by radio, television, wire,
satellite, and cable. The FCC is also charged with promoting the safety of life and
property through wire and radio communications. The mandate of the FCC under the
Communications Act is to make available to all people of the United States a rapid,
efficient, nationwide, and worldwide wire and radio communications service. The
FCC performs five major functions to fulfill this charge: spectrum allocation,
creating rules to promote fair competition and protect consumers where required by
market conditions, authorization of service, enhancement of public safety and
homeland security, and enforcement. The FCC obtains the majority of its funding
through the collection of regulatory fees pursuant to Title I, Section 9, of the
Communications Act of 1934; therefore, its direct appropriation is considerably less
than its overall budget.
For FY2008, the House of Representatives approved a budget of $313 million
(a direct appropriation of $1 million and the remainder to be collected through

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CRS-35
regulatory fees), $21.7 million above 2007 and the same as the President’s budget
request.59 Specifically, the budget allows:
! up to $4,000 for official reception and representation expenses;
! purchase of uniforms and acquisition of vehicles;
! special counsel fees;
! collection of $312 million in Section 9 fees;
! the sum appropriated to be reduced as Section 9 fees are collected.
New provisions also:
! prohibit fees collected in excess of $312 million from being
available for obligation;
! prohibit remaining offsetting collections from prior years from being
available for obligation;
! provides a $21 million transfer from the Universal Service Fund for
additional audits and oversight activities, including a direct
appropriation of $500,000;
! provides $2 million to educate the public regarding the transition to
digital television.
Finally, as in previous years, the approved budget includes a provision limiting the
funds available to administer the spectrum auctions program.
Federal Deposit Insurance Corporation (FDIC): OIG. The FDIC’s
Office of the Inspector General is funded from deposit insurance funds; the OIG has
no direct support from federal taxpayers. Before FY1998, the amount was approved
by the FDIC Board of Directors; the amount is now directly appropriated (through
a transfer) to ensure the independence of the OIG.
For FY2008, the President proposed, and the House approved, a budget of $26.8
million for the OIG, which is a 13% decrease from the FY2007 appropriation of $31
million.

Federal Election Commission (FEC). The FEC administers, and enforces
civil compliance with, the Federal Election Campaign Act (FECA)60 through
educational outreach, rulemaking, litigation, and advisory opinions to candidates and
political committees. The agency also administers the presidential public financing
system.
The President’s FY2008 budget request includes an appropriation of $59.2
million for the FEC, an 8.6% increase above the enacted FY2007 appropriation of
$54.5 million. In its FY2008 budget justification document, the FEC emphasized
efforts to contain costs by restructuring the agency’s internal processes and using
59 For FY2007, the FCC will receive funding at the FY2006 level, $289 million (a direct
appropriation of $1 million and the remainder to be collected through regulatory fees).
60 2 U.S.C. §431 et seq.

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CRS-36
technology to improve efficiency.61 The agency did not request any additional staff
despite anticipated “[i]ncreased workloads associated with [2008] Presidential
elections.”62 The FEC stated that much of its FY2008 budget request would be used
to cover a $1.6 million rent increase and to fund “mandated pay increases” for
employees.63 The FEC also proposed legislative language that would allow the
agency to collect fees for educational conferences.64
The House-passed version of the FSGG bill provided $59.2 million for FY2008
— the same amount the agency requested and recommended by the House
Appropriations Committee. The committee report did not contain particular
instructions for the FEC. Under a unanimous consent agreement regulating floor
consideration of the bill, amendments limiting presidential public campaign financing
could have been offered.65 However, the Legislative Information System and
Congressional Record show no record of those amendments actually being offered
on the floor. In fact, the FEC was the subject of limited discussion during FSGG
floor consideration. The version of the bill passed by the House specified minimum
and maximum levels of the appropriation to be used for FEC data automation and
“reception and representation” expenses.66
Federal Labor Relations Authority (FLRA). The FLRA is an independent
federal agency that administers and enforces Title VII of the Civil Service Reform
Act of 1978. Title VII, on Federal Service Labor-Management Relations, gives
federal employees the right to join or form a union and to bargain collectively over
the terms and conditions of employment. Employees also have the right not to join
a union. The statute excludes specific agencies (e.g., the Federal Bureau of
Investigation and the Central Intelligence Agency) and gives the President the
authority to exclude other agencies for reasons of national security.
The FLRA consists of a three-member authority, the Office of General Counsel,
and the Federal Services Impasses Panel (FSIP). The authority resolves disputes over
the composition of bargaining units, charges of unfair labor practices, objections to
representation elections, and other matters. The General Counsel’s office conducts
representation elections, investigates charges of unfair labor practices, and manages
the FLRA’s regional offices. The FSIP resolves labor negotiation impasses between
federal agencies and labor organizations.
61 See, for example, Federal Election Commission, Fiscal Year 2008 Performance Budget
for the Federal Election Commission, Congressional Submission, February 5, 2007, at
[http://www.fec.gov/pages/budget/fy2008/fy2008cbj_final.pdf], pp. 2-3.
62 Ibid., p. 3.
63 Ibid., p. 2.
64 Ibid., p. 4.
65 See Honorable José Serrano. “Providing for Further Consideration of H.R. 2829, Financial
Services and General Government Appropriations Act, 2008.” Remarks in the House.
Congressional Record, daily edition, vol. 153 (June 27, 2007), p. H7296.
66 H.R. 2829 as passed by the House, Title V.

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CRS-37
The President’s FY2008 budget proposed an appropriation of $23.7 million for
the FLRA, about $1.7 million below the agency’s FY2007 appropriation of $25.4
million. The House recommended an appropriation of $23.6 million, which is
$77,000 below the President’s request.
Federal Trade Commission (FTC). The Federal Trade Commission is an
independent agency. It seeks to protect consumers and enhance competition by
eliminating unfair or deceptive acts or practices in the marketing of goods and
services and by ensuring that consumer markets function competitively.
In recent years, the FTC has mostly funded its operations by means of its pre-
merger filing fees collections and, to a lesser extent, from Do-Not-Call fees. By way
of a historical footnote, for FY2000 through FY2002, zero ($0) direct appropriations
were required, because the entire program level was covered by a combination of fees
and prior-year collections.
For FY2008, the Administration requested a program level for the FTC of $240
million, an increase of $29 million, or 13.7%, over the agency’s present level of
funding. Of the total amount requested, $139 million was to be derived from pre-
merger filing fees, $19 million from Do-Not-Call fees, and the remaining amount —
$82 million — was to be provided by a direct appropriation. For FY2007, the total
budget authority enacted was $211 million, with $129 million to be derived from
filing fees and $23 million from Do-Not-Call fees, and the remaining amount — $59
million — was to be provided by a direct appropriation. The House approved $247
million in total budget authority for FY2008. Of that amount, $139 million would
be derived from pre-merger filing fees, $20 million would come from Do-Not-Call
fees, and the remaining $88 million would be funded through a direct appropriation.
General Services Administration (GSA). The General Services
Administration administers federal civilian procurement policies pertaining to the
construction and management of federal buildings, disposal of real and personal
property, and management of federal property and records. It is also responsible for
managing the funding and facilities for former Presidents and presidential transitions.
Typically, only about 1% of GSA’s total budget is funded by direct appropriations.
As indicated in Table 8, for FY2008, the President requested $144 million for
policy and operations, $47 million for the Office of Inspector General, $3 million for
allowances and office staff for former Presidents, and $18 million to be deposited
into the Federal Citizen Information Center Fund.
The House provided $135 million for GSA policy and operations, $53 million
for the Office of Inspector General, $3 million for allowances and office staff for
former Presidents, and $16 million to be deposited into the Federal Citizen
Information Center Fund.
Federal Buildings Fund (FBF). Most GSA spending is financed through
the Federal Buildings Fund. Rent assessments from agencies paid into the FBF
provide the principal source of its funding. Congress may also provide direct funding
into the FBF. Congress directs the GSA as to the allocation or limitation on spending

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CRS-38
of funds from the FBF in provisions found accompanying GSA’s annual
appropriations.
As indicated in Table 8,for FY2008, the President requested that an additional
amount of $345 million be deposited in the FBF, and that the total limitation for the
FBF be set at $8,091 million. The President’s budget further requested that $615
million remain available until expended for new construction projects from the FBF,
and $804 million remain available until expended for repairs and alterations.
The House provided that an additional amount of $88 million be deposited in
the FBF, and that the total limitation for the FBF be set at $7,835 million. The House
further provided that $525 million remain available until expended for new
construction projects from the FBF, and $733 million remain available until
expended for repairs and alterations.
Table 8. General Services Administration Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
House
Senate
FY2008
Fund/Office
Enacted
Request
Passed
Passed
Enacted
Federal Buildings Fund (FBF)
Total Limitations on
Availability of Revenues (new
$7,555
$8,091
$7,835
obligational authority)
Limitations on Obligation:
701
615
525
New Construction Projects
Limitations on Obligation:
618
804
733
Repairs and Alterations
Limitation on Obligation:
Installment Acquisition
164
156
156
Payments
Limitation on Obligations:
4,068
4,383
4,316
Rental of Space
Limitation on Obligations:
2,004
2,132
2,105
Building Operations
Direct Appropriations
Federal Buildings Fund
$94
$344
$88
Electronic Govt (E-Gov) Fund
3
5
3
General Activities (total)
206
212
207
Policy and Operations
0
144
135
Government-wide Policy
52
0
0

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CRS-39
FY2008
FY2008
FY2007
FY2008
House
Senate
FY2008
Fund/Office
Enacted
Request
Passed
Passed
Enacted
Operating Expenses
83
0
0
Office of Inspector General
53
47
53
Allowances and Office Staff
3
3
3
for Former Presidents
Federal Citizen Information
15
18
16
Center Fund
Direct Appropriations Total
$303
$561
$298
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
Electronic Government Fund (E-Gov Fund). Originally unveiled in
advance of the President’s proposed budget for FY2002, the E-Gov Fund and its
appropriation have been a somewhat contentious matter between the President and
Congress. The President’s initial $20 million request was cut to $5 million, which
was the amount provided for FY2003, as well. Funding thereafter was held at $3
million for FY2004, FY2005, FY2006, and FY2007. Created to support interagency
e-gov initiatives approved by the Director of OMB, the fund and the projects it funds
have been subject to close scrutiny by, and accountability to, congressional
appropriators. The President requested $5 million for FY2008, but the House
approved $3 million, as recommended by the House Appropriations Committee.
Independent Agencies Related to Personnel Management. The
FY2008 budget includes information on the portfolios of each of the agencies
involved in personnel management functions: the Federal Labor Relations Authority
(FLRA), the Merit Systems Protection Board (MSPB), the Office of Personnel
Management (OPM), and the Office of Special Counsel (OSC). Table 9 shows
appropriations as enacted for FY2007, as requested for FY2008, and as passed by the
House of Representatives for FY2008, for each of these agencies.

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CRS-40
Table 9. Independent Agencies Related to Personnel
Management Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
House
Senate
FY2008
Agency
Enacted
Request
Passed
Passed
Enacted
Federal Labor Relations
$25.4
$23.7
$23.6
Authority
Merit Systems Protection Board
38.7
40.1
40.1
(total)
Salaries and expenses
36.1
37.5
37.5
Limitation on administrative
2.6
2.6
2.6
expenses
Office of Personnel Management
19,593.8
21,097.7
21,109.7
(total)
Salaries and Expenses
111.6
101.8
101.8
Limitation on administrative
112.5
111.9
123.4
expenses
Office of Inspector General
2.1
1.5
1.5
(salaries and expenses)
Office of Inspector General
16.3
16.5
17.0
(limitation on administrative
expenses)
Government Payments for
8,780.3
8,884.0
8,884.0
Annuitants, Employees
Health Benefits*
Government Payments for
39.0
41.0
41.0
Annuitants, Employee Life
Insurancea
Payment to Civil Service
10,532.0
11,941.0
11,941.0
Retirement and Disability
Funda
Office of Special Counsel
15.5
16.4
16.4
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government and President’s FY2008 budget request.
a. The annual appropriations act provides “such sums as may be necessary” for the health benefits, life
insurance, and retirement accounts. The Office of Personnel Management’s Congressional
Budget Justification for FY2008 states the FY2008 amounts for these accounts as $9,138
million (health benefits), $41 million (life insurance), and $10,523 million (retirement) at pp.
87-89. These are the same amounts that are stated in the FY2008 Budget Appendix at pp. 1003-
1004.
Federal Labor Relations Authority (FLRA). The President’s budget
requested an FY2008 appropriation of $23.7 million for the FLRA. In its budget
submission, the agency reported a decline of 32% in the workload at its seven
regional offices between 2001 and 2004, and anticipated that the trend may increase.
H.R. 2829, as passed by the House, provides an appropriation of $23.6 million. The
House Committee on Appropriations report that accompanies the bill states that the

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CRS-41
appropriation for the FLRA is $77,000 less than the President’s budget request, but
provides no explanation for the reduction.
Merit Systems Protection Board (MSPB). The President’s budget
requested, and H.R. 2829, as passed by the House, provides an FY2008 appropriation
of just over $40 million for the MSPB. The authorization for the agency expires on
September 30, 2007. In its budget submission, MSPB projected a 2.4% increase in
decisions issued for cases related to retirement, adverse action appeals, and
reduction-in-force appeals in FY2008. The House committee report states that the
funding provided to the agency covers “mandatory pay raises, training, information
technology improvements, and increased rent payments.”
Office of Personnel Management (OPM). The President’s budget
requested, and H.R. 2829, as passed by the House, provides an FY2008 appropriation
of almost 102 million for salaries and expenses for OPM. This amount includes
funding of almost $6 million dollars for the Enterprise Human Resources Integration
project, more than $1.3 million for the Human Resources Line of Business project,
$340,000 for the E-payroll project, and $170,000 for the E-training program. Among
the initiatives that OPM stated that it will undertake for FY2008 are these:
demonstration projects on pay-for-performance “to replace the current General
Schedule ... with a modern classification, pay, and performance management system
that is both results-driven and market-based”; continued development of the
“prescription drug audit program, which includes audits of pharmacy benefit
managers” by the OPM Inspector General; and legislation to make technical changes
in the retirement annuities of individuals with part-time service under the Civil
Service Retirement System (CSRS) and to transition employees working in non-
foreign areas (e.g., Alaska and Hawaii) from non-foreign cost of living allowances
to locality pay.67
The House committee report notes that an increased amount ($1 million) is
authorized to be transferred from trust funds, $26.5 million of which is for retirement
systems modernization. The committee directs OPM to provide the committee with
quarterly reports on the program’s implementation beginning on January 31, 2008.
With regard to the Federal Human Capital Survey, the committee report directs OPM
to “continue to make agencies’ survey data publicly available in a consistent and
consolidated format, and in a timely manner.”
The committee report also urges OPM to work with the authorizing committees
“to consider changes in law to bring Federal prevailing rate [blue collar] employees
currently working in the Narragansett Bay, Rhode Island Wage Area within the
coverage of the Boston, Massachusetts Wage Area” and to report progress made on
this issue to Congress within 90 days of the act’s enactment. The report notes that
white-collar federal employees in Southeastern Massachusetts and Rhode Island are
included in the Boston Wage Area and that “[t]here is no reason for different
treatment between the two categories of employees.” According to the committee
report, the additional funding ($500,000) provided to the Office of Inspector General
67 FY2008 Budget Appendix, pp. 1080 (FLRA), 1091 (MSPB), 1115 (OSC), and 999, 1002,
and 1007 (OPM).

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(OIG) at OPM through trust fund transfer is intended “to maintain audit and
investigative staff at the current level and avoid deterioration of the OIG’s audit
capabilities.”
Office of Special Counsel (OSC). The President’s budget requested, and
H.R. 2829, as passed by the House, provides an FY2008 appropriation of $16.4
million for the OSC. The authorization for the agency expires on September 30,
2007. OSC projected a continued increase in the number of prohibited personnel
practice cases and disclosure cases received in its budget submission. Noting the
investigations recently undertaken by the OSC, the House committee report urges the
agency “to carefully evaluate the need for additional appropriations” and formally
request from OMB any additional funds necessary through a budget amendment.68
National Archives and Records Administration (NARA). The custodian
of the historically valuable records of the federal government since NARA’s
establishment in 1934, NARA also prescribes policy and provides both guidance and
management assistance concerning the entire life cycle of federal records. It also
administers the presidential libraries system; publishes the laws, regulations, and
presidential and other documents; and assists the Information Security Oversight
Office (ISOO), which manages federal security classification and declassification
policy; and the National Historical Publications and Records Commission (NHPRC),
which makes grants nationwide to help nonprofit organizations identify, preserve,
and provide access to materials that document American history.
As indicated in Table 7, the President’s FY2008 request for NARA was almost
$369 million, which was about $37 million more than was appropriated for FY2007.
Of this requested amount, almost $313 million was sought for operating expenses,
an increase of $34 million over the FY2007 appropriation for this account. For the
electronic records archive, $58 million was sought, a $13 million increase over the
previous fiscal year allocation; for repairs and restoration, a little less than $9 million
was sought, which was slightly below the FY2007 appropriation; and for the
NHPRC, no appropriation was requested, which was the President’s request for
FY2007, although Congress allocated $7 million. NARA’s FY2007 budget
justification indicates that no funding for the NHPRC grants program was sought in
order to focus funding on operations that directly affect management, access, and the
preservation of federal records.
The House approved the amounts recommended by appropriators for NARA,
totaling a little more than $388 million, which was almost $20 million more than the
President’s request. Of this amount, $315 million was provided for operating
expenses, an increase of a little more than $2 over the requested amount; $58 million
was allocated for the electronic records archive, which was the same as the requested
amount; and $16 million was appropriated for repairs and restoration, which was
almost twice the amount requested. While no funds had been requested for the
NHPRC grants program, the House approved $10 million as recommended by
appropriators, allocating $8 million for grants and $2 for NHPRC operating
expenses.
68 H.Rept. 110-207, pp. 59, 71, 76-77, 79.

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National Credit Union Administration (NCUA). The NCUA is an
independent federal agency funded entirely by the credit unions that the agency
charters, insures, and regulates. Two entities managed by the NCUA are addressed
by the Financial Services and General Government bill. One of these, the
Community Development Revolving Loan Fund (CDRLF), makes low-interest loans
and technical assistance grants to low-income credit unions. In FY2007, the CDRLF
received an appropriation of $941,000, and the President requested $950,000 for
FY2008. The House approved $1 million for the fund in H.R. 2829.
The other entity managed by NCUA, the Central Liquidity Facility (CLF),
provides a source of seasonal and emergency liquidity for credit unions. The CLF
can finance loans using its assets, and it can also borrow from the Federal Financing
Bank. Provisions in the appropriations bill set a borrowing limit for the CLF each
fiscal year. Congress also determines the level of CLF operating expenses, which are
not funded through appropriations, but by earned income. For FY2007, Congress
approved a $1.5 billion limitation on direct loans from the CLF, and the President
requested the same amount for FY2008. The House provided a $1.5 billion
limitation in H.R. 2829.
Securities and Exchange Commission (SEC). The SEC administers and
enforces federal securities laws to protect investors from fraud, and to maintain fair
and orderly markets. The SEC’s budget is set through the normal appropriations
process, but funds for the agency come from fees on sales of stock, new issues of
stocks and bonds, corporate mergers, and other securities market transactions. When
the fees are collected, they go to a special offsetting account available to
appropriators, not to the Treasury’s general fund. The SEC is required to adjust the
fee rates periodically in order to make the amount collected approximately equal to
the agency’s budget.
For FY2008, the Administration requested $905.3 million, an increase of 1.4%
over FY2007. Of that amount, $875 million would come from current-year offsetting
fee collections, and the remaining $30.3 million from prior-year unobligated
balances. No appropriation from the general fund would be required.69 In FY2007,
the enacted budget authority was $892.6 million, of which $25.0 million was prior-
year unobligated balances. There would be no direct appropriation from the general
fund.
The House Appropriations Committee recommended, and the House approved,
$908.4 million, $15.9 million (1.8%) above the FY2007 budget, and $3.1 million
(0.3%) above the Administration’s FY2008 request. Of that amount, $867.0 million
would come from current-year fee collections and $41.4 from prior year balances.
There would be no direct appropriation from the general fund.
Selective Service System (SSS). The SSS is an independent federal
agency operating with permanent authorization under the Military Selective Service
Act (50 U.S.C. App.§451 et seq.). It is not part of the Department of Defense, but
69 SEC fees are treated as direct appropriations in H.R. 2829, and not as off-setting
collections. This report follows the convention established in H.R. 2829 for SEC fees.

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its mission is to serve the emergency manpower needs of the military by conscripting
personnel when directed by Congress and the President.70 All males ages 18 through
25 and living in the United States are required to register with the SSS. The
induction of men into the military via Selective Service (i.e., the draft) terminated in
1972. In January 1980, President Carter asked Congress to authorize standby draft
registration of both men and women. Congress approved funds for male-only
registration in June 1980.
Since 1972, Congress has not renewed any President’s authority to begin
inducting (i.e., drafting) anyone into the armed services. Recent efforts to provide
the President with induction authority have been rejected.71
Funding of Selective Service has remained relatively stable over the last decade.
For FY2008, the President requested, and the House approved, $22 million, which
is $3 million less than the FY2007 appropriation.
Small Business Administration (SBA). The SBA is an independent
federal agency created by the Small Business Act of 195372. Although the agency
administers a number of programs intended to assist small firms, arguably its three
most important functions are: (1) to guarantee — principally through the agency’s
Section 7(a) general business loan program — business loans made by banks and
other financial institutions; (2) to make long-term, low-interest disaster loans to small
businesses, nonprofits, and households that are victims of hurricanes, earthquakes,
other physical disasters, and acts of terrorism; and, (3) to serve as an advocate for
small business within the federal government.
The House provided the SBA with new budget authority of $582 million for
FY2008, an increase of $119 million over the Administration’s request of $464
million. The recommendation is $11 million more than FY2007’s enacted $572
million. The House-passed bill includes $82 million in business loan subsidies (the
Administration requested no funds for subsidies), and $36 million more for salaries
and expenses than the Administration’s request.
The House recommended no new budget authority for the disaster loan program
in FY2008. The Administration requested no new budget authority; in FY2007 the
disaster loan program received $113 million. Up to $156 million in unused budget
authority carried over from previous years could be used to operate the disaster loan
program in FY2007. Lending authority would stay the same for all loan programs.
United States Postal Service (USPS).73 The U.S. Postal Service generates
nearly all of its funding — about $73 billion annually — by charging users of the
70 See [http://www.sss.gov/].
71 See H.R. 163, October 5, 2004, failed by Yeas and Nays: (2/3 required): 2 - 402 (Roll no.
494).
72 P.L. 83-163, as amended. 62 Stat. 262.
73 Also see CRS Report RS21025, The Postal Revenue Forgone Appropriation: Overview
and Current Issues, by Kevin Kosar.

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mail for the costs of the services it provides.74 Congress does provide an annual
appropriation, however, to compensate USPS for revenue it forgoes in providing, at
congressional direction, free mailing privileges to the blind75 and overseas voters.76
Appropriations for these purposes are authorized by the Revenue Forgone Reform
Act of 1993 (RFRA).77 This act also authorizes Congress to reimburse USPS $29
million each year until 2035, for postal services provided at below-cost rates to not-
for-profit organizations — at congressional direction — in the early 1990s.
In its FY2008 budget, the Administration proposed a total appropriation of
$88.9 million,78 $20 million less than was enacted for FY2007. Of this, $64.5
million would be for revenue forgone in FY2008, and $24.4 million would be for a
reconciliation adjustment for underestimated revenue forgone in FY2005.
In its FY2008 budget submission, USPS requested a $153.4 million
appropriation.79 Of this amount, $29 million would be for the annual reimbursement
under RFRA; $83.5 million would be for revenue forgone; and $40.9 million would
be for reconciliation adjustments for underestimated revenue forgone in FY2005 and
FY2006.
The Administration’s FY2008 budget not only proposed less revenue forgone
funding than USPS has requested, but also eliminated the $29 million annual
reimbursement authorized by RFRA. (The Administration also proposed termination
of the annual reimbursement in FY2005, FY2006, and FY2007, but Congress chose
to provide the funding, as it has each year since FY1994.) Additionally, the
Administration’s budget proposed that none of the $88.9 million appropriation to
USPS would be available for obligation until October 1, 2008, which is in FY2009.
Since FY1994, appropriations to USPS have delayed until the following fiscal year
only the revenue forgone portion of the appropriation; the remainder of the
appropriation was made available for obligation in the upcoming fiscal year.
On June 11, 2007, the House Appropriations Committee approved a bill that
would provide USPS with $117.9 million. Of this amount, $29 million would be for
74 United States Postal Service Annual Report 2006 (Washington: USPS, 2006), p. 3.
75 84 Stat. 757; 39 U.S.C. §3403. See also USPS, Mailing Free Matter for Blind and
Visually Handicapped Persons: Questions and Answers, Publication 347 (Washington:
USPS, May 2005), at [http://www.usps.com/cpim/ftp/pubs/pub347.pdf].
76 Members of the armed forces and U.S. citizens who live abroad are eligible to register and
vote absentee in federal elections under the provisions of the Uniformed and Overseas
Citizens Absentee Voting Act of 1986 (42 U.S.C.§1973ff-ff-6). See CRS Report RS20764,
The Uniformed and Overseas Citizens Absentee Voting Act: Background and Issues, by
Kevin J. Coleman.
77 107 Stat. 1267, 39 U.S.C. §2401(c)-(d). See also CRS Report RS21025, The Postal
Revenue Forgone Appropriation: Overview and Current Issues, by Kevin R. Kosar.
78 Office of Management and Budget, President’s Budget FY2008 — Appendix (Washington:
GPO, 2007), p. 1116.
79 USPS, “Fiscal Year 2008 Appropriation Request,” December 6, 2006, at
[http://www.usps.com/financials/_pdf/Appropriations-2008_Public.pdf].

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the RFRA reimbursement and $88.9 million would be for revenue forgone. As in the
past, the Committee would have the RFRA reimbursement paid to USPS in the
current fiscal year (FY2008) and the revenue foregone payment would become
available to USPS in the following fiscal year (FY2009). On June 21, the Committee
removed the $29 million RFRA reimbursement payment. The House approved an
appropriation of $88.9 million under H.R. 2829, which is equal to the amount
proposed in the President’s FY2008 budget and $20.1 million less than was enacted
in FY2007.
In its report on the bill, the Committee did not state why it had not approved the
$29 RFRA reimbursement.80 The Committee did express its concerns over USPS’s
possible closure of postal facilities in the Bronx borough of New York City,
Pasadena, California, and elsewhere. The Committee also expressed its concerns
over the quality of mail delivery service in Chicago, Illinois, and directed USPS to
report to Congress on USPS efforts to “take into consideration the views of local
postal management in the development of appropriate staffing levels to ensure that
postal customers receive the quality mail service that they expect and deserve.”
United States Tax Courts (USTC). A court of record under Article I of the
Constitution, the United States Tax Court is now an independent judicial body in the
legislative branch and has jurisdiction over various tax matters as set forth in Title
26 of the United States Code. The court is headquartered in Washington, DC, but its
judges conduct trials in many cities across the country.
The President requested $45.3 million for FY2008, about $2.3 million below the
USTC’s FY2007 appropriation. The House approved $45.1 million for the USTC
for FY2008.
General Provisions Government-Wide
The Financial Services and General Government Appropriations bill includes
general provisions which apply either government-wide or to specific agencies or
programs. There may also be general provisions at the end of an individual title
within the appropriations act which relate only to agencies and accounts within that
specific title. The Administration’s proposed language for government-wide general
provisions is included in the FY2008 Budget, Appendix.81 Most of the provisions
continue language that has appeared under the General Provisions title for several
years. For various reasons, Congress has determined that reiterating the language is
preferable to making the provisions permanent. Presented below are some of the
government-wide general provisions that were included in P.L. 109-115, the
Transportation, Treasury, Housing and Urban Development, the Judiciary, the
80 U.S. Congress, House Committee on Appropriations, Financial Services and General
Government Appropriation Bill, 2008, 110th Cong., 1st sess., H.Rept. 110-207 (Washington:
GPO, 2007), pp. 84-86.
81 FY2008 Budget, Appendix, pp. 9-12.

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District of Columbia, and Independent Agencies Appropriations Bill for FY2006,82
but that are not included in the FY2008 budget proposal. (The section numbers refer
to the provisions as they appeared in P.L. 109-115. H.R. 5576, the FY2007
Transportation, Treasury, Housing and Urban Development, the Judiciary, the
District of Columbia, and Independent Agencies Appropriations Bill, as passed by
the House and reported in the Senate, was not enacted.) Inclusion of the provisions
in H.R. 2829, as passed by the House, is noted.
! Section 809, which prohibits payment to political appointees who
are filling positions for which they have been nominated, but not
confirmed. Included as Section 709 of the House bill as passed and
made permanent.
! Section 819, which prohibits the obligation or expenditure of
appropriated funds for employee training that (1) does not meet
identified needs for knowledge, skills, and abilities bearing directly
upon the performance of official duties; (2) contains elements likely
to induce high levels of emotional response or psychological stress
in some participants; (3) does not require prior employee notification
of the content and methods to be used in the training and written end
of course evaluation; (4) contains any methods or content associated
with religious or quasi-religious belief systems or “new age” belief
systems; or (5) is offensive to, or designed to change, participants’
personal values or lifestyle outside the workplace. Included as
Section 718 of the House bill as passed.
! Section 820, which prohibits the use of appropriated funds to
implement or enforce employee non-disclosure agreements if they
do not contain whistleblower protection clauses. Included as Section
719 of the House bill as passed.
! Section 823, which requires that the Committees on Appropriations
approve the release of any “non-public” information, such as mailing
or telephone lists, to any person or any organization outside the
federal government. Included as Section 722 of the House bill as
passed.
! Section 834, which states that Congress recognizes the United States
Anti-Doping Agency as the official anti-doping agency for Olympic,
Pan American, and Paralympic sports in the United States. Included
as Section 733 of the House bill as passed.
! Section 836, which prohibits the use of appropriated funds to
implement or enforce restrictions or limitations on the Coast Guard
Congressional Fellowship Program or to implement OPM’s
proposed regulations limiting the detail of executive branch
82 P.L. 109-115, November 30, 2005, 119 Stat. 2495-2507.

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employees to the legislative branch. Included as Section 735 of the
House bill as passed.
! Section 837, which requires agencies to report to Congress on the
amount of the acquisitions made from entities that manufacture the
articles, materials, or supplies outside the United States. This
provision is not included in the House bill as passed.
! Section 839, which requires appropriate executive department and
agency heads either to transfer funds to, or reimburse, the Federal
Aviation Administration to ensure the uninterrupted, continuous
operation of the Midway Atoll airfield. This provision is not
included in the House bill as passed.
! Section 840, which provides certain requirements for conducting a
public-private competition for the performance of an activity that is
not inherently governmental for executive agencies with less than
100 full-time employees. This provision is not included in the
House bill as passed.
! Section 842, which prohibits the use of funds to convert an activity
or function of an executive agency to contractor performance if more
than 10 federal employees perform the activity, unless the analysis
reveals that savings would exceed 10 percent of the most efficient
organization’s personnel-related costs for performance of the activity
or function by federal employees, or $10 million, whichever is
lesser. Included as Section 738 of the House bill as passed.
! Section 845, which precludes contravention of the Privacy Act.
Included as Section 741 of the House bill as passed.
The FY2008 budget proposed a new Section 834 to provide a 3.0% pay (annual
and locality pay combined) adjustment for federal civilian employees. Section 739
of H.R. 2829, as passed, provides a 3.5% pay adjustment for federal civilian
employees, including employees in the Department of Homeland Security and
employees in the Department of Defense (DOD) who are represented by a labor
organization. DOD employees who are eligible to be represented by a labor
organization, but are not so represented, will receive the pay adjustment unless pay
for their positions is adjusted under 5 U.S.C. §9902.83 A new provision is included
in the House bill as passed at Section 743 that requires the Office of Management
and Budget to submit a report on budget information relating to the activities to
restore the health of the Great Lakes ecosystem.
83 The Statement of Administration Policy on H.R. 2829 issued by OMB on June 27, 2007,
expressed strong opposition to the 3.5% pay adjustment, stating that it “would cost agencies
over $600 million in FY2008 and would not target any specific recruitment or retention
challenges.” The statement also urged that the provision related to a pay adjustment for DHS
and DOD employees be deleted, saying that it “backs away from the concept of pay-for-
performance and is ambiguous as to how the increase would be applied.” (p. 4.)

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Section 901 of the House-passed bill also prohibits the use of funds to
implement Executive Order 13422 related to the authority of the President over
executive agency rulemaking.84
Competitive Sourcing
Although the term “competitive sourcing” was coined by the Bush
Administration in 2001, public-private competition began in 1966, with the
publication of Office of Management and Budget (OMB) Circular A-76. Circular A-
76 provides policy and guidance for conducting competitions involving government
employees and contractors. For many years, OMB continued to be the exclusive
source of guidance on public-private competitions. The late 1990s witnessed a
notable change, with the advent of competitive sourcing legislation, and, in
particular, the passage of bills containing competitive sourcing provisions.85
Section 738(a) of H.R. 2829 prohibits the use of funds for converting an agency
activity involving 11 or more federal employees to contractor performance unless
certain conditions are met. Public-private competitions that meet this size criterion
would have to include a most efficient organization (MEO); would show that the cost
of contractor performance would result in a savings of at least $10 million or 10%
of the MEO’s personnel costs, whichever amount is lesser; and would not provide
a contractor with an advantage by permitting the company to provide health and
retirement benefits to the employees performing the government activity that are less
than what federal employees receive.86 The first two conditions appear designed to
address two distinctions between standard competitions and streamlined
competitions. Under Circular A-76, agencies are required to develop an MEO and
apply the conversion differential (that is, $10 million or 10% of the MEO’s personnel
costs) for standard competitions. (An agency is required to use a standard
competition when a public-private competition involves more than 65 full-time
equivalents (FTEs).87) In streamlined competitions, an agency may develop an MEO
but is not required to do so, and the conversion differential is not calculated.88 (An
agency may use a streamlined or a standard competition when a public-private
competition involves 65 or fewer FTEs.) The third condition may be seen as an
effort to ensure that a contractor does not gain a cost advantage in competitions by
84 Congressional Record, daily edition, vol. 153, June 27, 2007, pp. H7322-H7323. For an
analysis of the Executive Order, see CRS Report RL33862, Changes to the OMB Regulatory
Review Process by Executive Order 13422, by Curtis W. Copeland.
85 See CRS Report RL32833, Competitive Sourcing Statutes and Statutory Provisions, by
L. Elaine Halchin.
86 A most efficient organization is the staffing plan of the agency tender, which is the
government’s response to a solicitation.
87 A full-time equivalent (FTE) is “[t]he staffing of Federal civilian employee positions,
expressed in terms of annual productive work hours (1,776 [hours]) rather than annual
available hours that includes non-productive hours (2,080 hours).” (U.S. Office of
Management and Budget, Circular No. A-76 (Revised), May 29, 2003, p. D-5.)
88 Ibid., pp. B-4 and C-2.

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paying less for benefits than the government does, thus lowering the cost of his or
proposal. Alternatively, others may see this condition as a restriction on the ability
of a contractor to prepare a competitive proposal. Certain organizations and
procurement activities, such as the Department of Defense and depot maintenance
contracts, would be exempt from this section of H.R. 2829.
Although Circular A-76 does not appear to prohibit conducting a public-private
competition for work that is being performed by a contractor, some of the language
in the circular seems to emphasize holding competitions for work being performed
by federal employees. For example, the circular’s policy statement says, in part:
“The longstanding policy of the federal government has been to rely on the private
sector for needed commercial services.... Identify all activities performed by
government personnel as either commercial or inherently governmental.... Perform
inherently governmental activities with government personnel.... Use a streamlined
or standard competition to determine if government personnel should perform a
commercial activity.”89 Section 738(b) of H.R. 2829 notes that the circular does not
prevent holding competitions for working being performed by contractors, and it also
requires that Circular A-76 include procedures and policies for these types of
competitions.
Currently, only the agency tender official (ATO) is permitted to file a protest on
behalf of government employees, and protests may be filed only for standard
competitions.90 Section 738(b) would allow a protest to be filed for any competition
(that is, streamlined as well as standard) conducted under Circular A-76, and for any
decision made without benefit of an A-76 competition to convert an agency function
from employee performance to contractor performance. This section also would
permit an individual selected by a majority of the affected employees to represent the
employees in a protest involving an A-76 competition or a decision to outsource
work without a competition. The ATO would retain the authority to file a protest on
behalf of the employees under Section 738(b). Currently, an ATO is not required to
file a protest: he or she “shall file a protest in connection with ... [a] public-private
competition unless the [agency tender] official determines that there is no reasonable
basis for the protest.”91 Some have been concerned that agency employees’ interests
may not be adequately represented since an ATO determines unilaterally whether
there is a basis for a protest. Hence, supporters of this view might argue that another
individual, such as a union representative, would be a better choice for representing
the affected employees. In response, the private sector might argue that allowing the
ATO to file a protest is sufficient protection for agency employees. Additionally,
contractors might note that their employees cannot band together and select someone
to represent them in a protest.
If enacted, Section 738 of H.R. 2829 would broaden employees’ protest rights
in other ways as well. Specifically, Section 738(c)(2) would permit the individual
89 Ibid., p. 1.
90 The agency tender official is an “agency official with decision-making authority who is
responsible for the agency tender and represents the agency tender during source selection.”
(Ibid., p. D-2.)
91 31 U.S.C. §3351(2); Sec. 326(b)(1) of P.L. 108-375.

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representing employees affected by a public-private competition to intervene in any
civil action brought by an interested party from the private sector. Additionally, this
section would permit protests and civil actions that challenge the selection of a
provider (that is, government employees or a contractor) at the conclusion of a
competition.
The final substantive provision in this section would prohibit the use of funds
made available by this act for certain purposes. That is, none of the funds
appropriated by this act could be used by OMB for directing or requiring an agency
to take any action related to a public-private competition, or a direction conversion
of a government activity from one sector to another. Similarly, none of the funds
could be used by another agency take an action that was directed or required by
OMB.
Section 738 would apply to FY2008 and succeeding fiscal years.
Cuba Sanctions92
Since the early 1960s, U.S. policy toward Communist Cuba has consisted
largely of efforts to isolate the island nation through comprehensive economic
sanctions, including prohibitions on U.S. financial transactions — the Cuban Assets
Control Regulations (CACR) — that are administered by the Treasury Department’s
Office of Foreign Assets Control (OFAC). Some U.S. commercial agricultural
exports to Cuba have been allowed since 2001 under the terms of the Trade Sanctions
Reform and Export Enhancement Act of 2000 or TSRA, but with numerous
restrictions and licensing requirements. Exporters are denied access to U.S. private
commercial financing or credit, and all transactions must be conducted in cash in
advance or with financing from third countries.
In February 2005, the Administration tightened sanctions against Cuba by
further restricting how U.S. agricultural exporters may be paid for their sales. OFAC
amended the CACR to clarify that the term “payment of cash in advance” for U.S.
agricultural sales to Cuba means that the payment is to be received prior to the
shipment of the goods. This differs from the practice of being paid before the actual
delivery of the goods, a practice that had been utilized by most U.S. agricultural
exporters to Cuba since such sales were legalized in late 2001. U.S. agricultural
exporters and some Members of Congress strongly objected on the grounds that the
action constituted a new sanction that violated the intent of TSRA, and could
jeopardize millions of dollars in U.S. agricultural sales to Cuba. OFAC Director
Robert Werner maintained that the clarification “conforms to the common
understanding of the term in international trade.”93 Since late 2001, Cuba has
purchased about $1.6 billion in agricultural products from the United States, although
the annual amount began to decline in 2005. Overall U.S. exports to Cuba amounted
to about $7 million in 2001, $146 million in 2002, $259 million in 2003, $404
92 For additional information, see CRS Report RL33819, Cuba, Issues for the 110th
Congress, by Mark P. Sullivan.
93 U.S. Department of the Treasury, Testimony of Robert Werner, Director, OFAC, before
the House Committee on Agriculture, March 16, 2005.

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million in 2004, $369 million in 2005, $340 million in 2006, and $116 million in the
first four months of 2007, the majority in agricultural products.94
Since 2000, either one or both houses have approved provisions in the annual
Treasury Department appropriations bill that would ease U.S. economic sanctions on
Cuba (especially on travel and on U.S. agricultural exports) but none of these
provisions have ever been enacted. The Administration regularly threatened to veto
legislation if it included provision weakening sanctions on Cuba.
This year, the House-passed version of the FY2008 Financial Services and
General Government appropriations bill, H.R. 2829, contains a provision in section
903 that would prevent Treasury Department funds from being used to implement the
February 2005 regulation that requires the payment of cash in advance prior to the
shipment of U.S. agricultural goods to Cuba. The House adopted the provision during
June 28, 2007 floor consideration when it approved H.Amdt. 467 (Moran, Kansas)
by voice vote. The Administration’s statement of policy on the bill maintained that
the President would veto the measure if it contained a provision weakening current
restrictions against Cuba.95
94 World Trade Atlas. Department of Commerce Statistics.
95 Executive Office of the President, Office of Management and Budget, “Statement of
Administration Policy, H.R. 2829 — Financial Series and General Government
Appropriations Act, 2008,” p. 1.

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